The U.S. private credit market’s trailing 12-month default rate reached a record 6.3% through August 2026, up from 6.1% in July, among the 1,300 borrowers tracked by Fitch Ratings. August produced 14 default events, including 11 first-time defaulters and three repeat defaulters, with the monthly total reaching its highest level in the past year. Stress was concentrated in amendments and restructuring arrangements: maturity extensions accounted for 45% of August defaults, while interest deferrals and payment-in-kind substitutions represented 47% of default events over the year. Healthcare and industrial/manufacturing each posted 9.9% default rates, compared with 0.6% for technology software. Fitch said uncertainty over interest rates and inflation has reduced deal liquidity, making it harder for lenders to sell distressed portfolio companies before maturities. The firm’s default framework counts forced maturity extensions and other relaxed loan terms as defaults even when borrowers continue operating, highlighting credit deterioration before bankruptcy or liquidation. Smaller borrowers remained more vulnerable, with companies generating less than $25 million of EBITDA recording a 12.0% rate, compared with 5.2% for companies generating $26 million to $50 million. Fitch’s measure combines a model-based series and a privately monitored series; the former rose to 5.6% in August from 5.2% in July, while the latter eased to 8.5% from 8.6%.