Moody’s drops Paranapanema CFR to B1

Moody's Investors Service said it downgraded Paranapanema SA’s corporate family rating to B1 from Ba3.

The outlook remains negative.

Moody’s said the downgrade reflects the prolonged period of weak market fundamentals in Brazil and the observed increase in the company debt levels (in Brazilian real) over the last few quarters, which may constrain its credit profile.

With the sharp slowdown in Brazil's economy, key consuming industries for copper and copper products – energy, construction, refrigeration, industrial machinery, automotive – will continue to be challenged through at least 2016, the agency said.

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