S&P turns El Salvador view to negative

S&P said it revised its outlook on El Salvador to negative from stable and affirmed its B- long-term sovereign credit rating.

The negative outlook reflects the at least one-in-three chance of a downgrade over the next six to 18 months if the government does not make adequate progress filling its substantial financing gap in the coming years. We expect that the government will reach an agreement with the IMF to secure new funding and gain greater access to other multilateral and commercial sources. However, delays in obtaining more funding, as well as in undertaking corrective fiscal measures to reduce deficits, could hurt investor confidence and make it more difficult for the government to fill its financing gap,” S&P said in a press release.

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