Fitch Ratings still sees elements supporting Brazil’s investment grade, a senior analyst with the ratings firm said on Thursday, easing market fears the agency could follow Standard & Poor’s decision to cut the country to junk.
Speaking at a Fitch conference in New York, analyst Shelly Shetty said that Brazil’s credit rating is deteriorating and that there is a greater than 50 percent chance it will be downgraded.
But a one-notch downgrade would still leave Brazil with investment grade, because Fitch currently has the country at BBB, or two notches above junk level, with a negative outlook.
“There are clearly elements which still buttress the investment-grade credentials,” Shetty told investors, citing Brazil’s economic diversity, per capita income levels, and the government’s net creditor position in dollars.
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