Capital outflows from Brazilian asset markets and the Real's slide to new all-time lows against the U.S. dollar pose little threat to Brazil's sovereign credit profile, ratings agency Moody's said on Monday.
Concerns that Brazil may lose its coveted investment grade credit rating are again on the rise among government officials and investors who worry that President Dilma Rousseff’s austerity push won’t fully offset plunging government revenues.
Brazil's debt levels will continue to increase through 2016 and remain high despite the government's fiscal consolidation efforts, potentially weakening the sovereign's credit profile, says Moody's Investors Service.
Uruguay is likely to be the next Latin American country to win an investment grade rating from Moody's Investors Service, with a review likely late this year, a senior officer from the ratings agency said on Sunday.
Credit rating agencies believe that in spite of the successful management of its sovereign debt Uruguay still has some issues to improve before investment grade is awarded. Moody’s has promised to visit Uruguay at the beginning of next year to assess those conditions.