Fitch cuts Peru local-currency rating

Fitch Ratings said it downgrade Peru’s long-term local-currency issuer default rating to BBB+ from A-. Also, Fitch affirmed Peru’s long-term foreign-currency IDR at BBB+.

“Fitch no longer considers Peru’s public finances a strength relative to its external finances. Expenditure measures and lost revenues caused by the coronavirus pandemic are forecast to lift general government debt/GDP to 31.9% in 2020, up from 26.8% in 2019,” the agency said in a press release.

Fitch said it expects the country to use up its fiscal stabilization fund and use other liquid treasury balances, leaving the government few liquid assets to deal with future shocks.

“In contrast, Fitch expects external accounts to be relatively resilient to the current shock, supported by strong external liquidity buffers and a net external creditor position,” Fitch said.

The outlook is stable.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.