S&P downgrades Vale to BBB+

Standard & Poor's said it lowered its ratings on Vale SA to BBB+ from A-.

The outlook is stable.

At the same time, the agency lowered its senior unsecured rating on Vale's subsidiary, PT Vale Indonesia Tbk., to BBB+ from A-. Vale fully guarantees these notes.

Moody’s said the downgrade reflects its expectation that Vale's financial risk profile will weaken in the next two years to levels incompatible with our previous rating. The downgrade also follows the agency’s revision of iron ore price assumptions to $65 per ton in 2015 and 2016 and to $70 per ton in 2017 (Platts 62% iron content).

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