{"id":18175,"date":"2016-02-24T12:10:05","date_gmt":"2016-02-24T17:10:05","guid":{"rendered":"http:\/\/olduvai.ca\/?p=18175"},"modified":"2016-02-24T12:11:06","modified_gmt":"2016-02-24T17:11:06","slug":"brazil-cut-to-junk-by-all-three-ratings-agencies-after-moodys-joins-the-fray","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=18175","title":{"rendered":"Brazil Cut To Junk By All Three Ratings Agencies After Moody&#8217;s Joins The Fray"},"content":{"rendered":"<h3 class=\"title\"><a href=\"http:\/\/www.zerohedge.com\/news\/2016-02-24\/moodys-joins-sp-fitch-cuts-brazil-junk\" target=\"_blank\">Brazil Cut To Junk By All Three Ratings Agencies After Moody&#8217;s Joins The Fray<\/a><\/h3>\n<div class=\"tabs\">Back in December we warned that Brazil faced a &#8220;<a href=\"http:\/\/www.zerohedge.com\/news\/2015-12-10\/brazil-faces-disastrous-downgrade-debacle-heres-what-you-need-know\">disastrous downgrade debacle<\/a>&#8221; that would eventually see the beleaguered South American nation cut to junk by all three major ratings agencies.<\/div>\n<div class=\"node\">\n<div class=\"content\">\n<p>S&amp;P had already thrown the country into the junk bin and just six days after our warning,\u00a0<a href=\"http:\/\/www.zerohedge.com\/news\/2015-12-16\/brazil-stocks-currency-tumble-after-fitch-downgrade-junk\">Fitch followed suit<\/a>.<\/p>\n<p>Between the country&#8217;s seemingly intractable political crisis and worsening public finances, the outlook is exceptionally dire and\u00a0<strong>just moments ago, Moody&#8217;s cut Brazil to junk as well<\/strong>.<\/p>\n<ul>\n<li><strong>MOODY\u2019S DOWNGRADES BRAZIL\u2019S ISSUER, BOND RATINGS TO Ba2 W\/ A<\/strong><\/li>\n<li>BRAZIL\u2019S ISSUER &amp; BOND RATINGS CUT TO Ba2 BY MOODY\u2019S<\/li>\n<li>DETERIORATING DEBT METRICS WILL RESULT IN A MATERIALLY WEAKER CREDIT PROFILE IN THE COMING YEARS<\/li>\n<\/ul>\n<p>Watch the BRL and the Bovespa. Things likely won&#8217;t be pretty.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/www.zerohedge.com\/sites\/default\/files\/images\/user92183\/imageroot\/2016\/02\/09\/Brazil_0.png\" alt=\"\" width=\"600\" height=\"388\" \/><\/p>\n<p>Below, find the rationale.<\/p>\n<p>* \u00a0* \u00a0*<\/p>\n<p><em>From\u00a0<a href=\"https:\/\/www.moodys.com\/research\/Moodys-downgrades-Brazils-issuer-and-bond-ratings-to-Ba2-with--PR_342928\">Moody&#8217;s<\/a><\/em><\/p>\n<p><strong>Moody&#8217;s downgrades Brazil&#8217;s issuer and bond ratings to Ba2 with a negative outlook<\/strong><\/p>\n<p>The downgrade was driven by<\/p>\n<ul>\n<li>The prospect of further deterioration in Brazil&#8217;s debt metrics in a low growth environment, with the government&#8217;s debt likely to exceed 80% of GDP within three years; and<\/li>\n<li>The challenging political dynamics, which will continue to complicate the authorities&#8217; fiscal consolidation efforts and delay structural reforms.<\/li>\n<\/ul>\n<p>The negative outlook reflects the view that risks are skewed toward an even slower consolidation and recovery, or further shocks emerging, which creates uncertainty over the magnitude of deterioration of Brazil&#8217;s debt profile over the rating horizon.<\/p>\n<p><strong>RATIONALE FOR THE DOWNGRADE<\/strong><\/p>\n<p>Brazil&#8217;s credit metrics have deteriorated materially since the Baa3 rating with a stable outlook was assigned in August 2015. That deterioration is expected to continue over the coming three years, given the scale of the shock to the Brazilian economy, the lack of progress made by the government in achieving its fiscal and economic reform objectives and the political dynamics expected to persist over that period.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Brazil Cut To Junk By All Three Ratings Agencies After Moody&#8217;s Joins The Fray Back in December we warned that Brazil faced a &#8220;disastrous downgrade debacle&#8221; that would eventually see the beleaguered South American nation cut to junk by all three major ratings agencies. S&amp;P had already thrown the country into the junk bin and [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[1719,12579,90,3108,7549,7530,12580,670,4318],"class_list":["post-18175","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bond","tag-bovespa","tag-brazil","tag-fitch","tag-investor-sentiment","tag-ratings","tag-ratings-agencies","tag-recovery","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18175","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18175"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18175\/revisions"}],"predecessor-version":[{"id":18177,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18175\/revisions\/18177"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18175"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18175"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18175"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}