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Fitch downgrades USG
Fitch Ratings said it downgraded USG Corp.'s issuer default rating to B- from B.
The agency also said it downgraded its secured bank credit facility to BB- with a recovery rating of RR1 from BB with a recovery rating of RR1, senior unsecured guaranteed notes to B+ with a recovery rating of RR2 from BB with a recovery rating of RR1, senior unsecured notes to CCC with a recovery rating of RR5 from B- with a recovery rating of RR5 and convertible senior unsecured notes to CCC with a recovery rating of RR5 from B- with a recovery rating of RR5.
The outlook remains negative.
The downgrades reflect a belief that underlying demand for the company's products will remain weak through at least 2012, Fitch said, and the company's liquidity position is likely to deteriorate in the next 18 months.
With the recent softening in the economy and lowered economic growth expectations for 2011 and 2012, the environment may at best support a relatively modest recovery in housing metrics over the next year and a half, the agency said.
Fitch said it previously forecast a slightly more robust housing environment in 2011 and 2012.
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