Brasília – The credit-rating agency Standard & Poor’s reported this Tuesday (28th) that it had kept the long-term foreign currency credit ratings of Brazil at BBB-. However, the agency reviewed the ratings outlook to negative. The country kept its investment grade, that is, it continues to be considered safe for investors.
In the press release it announced the review, the agency reports that there was “a significant policy correction during the second term of President Dilma Rousseff” but, still, “Brazil is facing political and economic challenges”.
Standard & Poor’s said that a number of corruption investigations into some politicians and companies are weighing on the fiscal and economic outlook of the country, putting at risk the effective policy implementation, particularly in Congress.
“We revised our outlook on the foreign-currency ratings on Brazil to negative to reflect what we believe is a greater than one-in-three likelihood that the policy correction will face further slippage given fluid political dynamics and that the return to a firmer growth trajectory will take longer than expected”, says the credit-rating agency.
In the Standard & Poor’s assessment, since March of this year, when the last analysis was made, the country’s risks increased. According to the agency, in the short term the weakening of political cohesion in Congress is a material risk, with the possibility of the political correction turn ineffective.
*Translated by Sérgio Kakitani
