The Fitch Ratings agency downgraded a notch yesterday the “signature” of Brazil on the debt market, increasing it from BB + to BB, to speculative grade, with a negative outlook.
The agency notation explained his decision by the severity of the economic recession fueled by political uncertainty. The modification of the budgetary objectives of the government has also undermined the credibility of Brasilia, added Fitch. This downgrade of Brazil comes a week before a crucial Senate vote on the impeachment proceedings against President Dilma Rousseff.
During a telephone interview, the director of Fitch for Brazil Rafael Guedes, compared the Brazilian economic outlook to those prevailing in Argentina in 2001, months before the default that caused a serious crisis in the country. But he added that if the Brazilian authorities act quickly to reduce the burden of debt, the rating of the largest economy in South America may be identified.
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