Standard & Poor's downgrades Brazil three levels below investment grade

Brasília - Ratings agency Standard & Poor's (S&P) downgraded Brazil's credit rate three levels below the investment grade, with a stable outlook. The downgrade was announced this Thursday (Dec. 11) night.

The stable outlook means the ratings company will have to wait at least six months to change the country's credit rate again. Investment grade means certainty that a country is not at risk of public debt default.

In a comunicate, S&P informed Brazil is taking too long to implement reforms to help reducing fiscal risk, particularly the pension reform. “Despite various policy advances by the Temer administration, Brazil has made slower-than-expected progress in putting in place meaningful legislation to correct structural fiscal slippage and rising debt levels”, the agency justified.

Since February of 2016, Brazil is two notches below the investment grade by S&P's assessment . The other two main ratings agencies, Fitch and Moody's, have not changed the country's credit rate so far, keeping it two levels below the investment grade.

Translated by Mariana Branco