Moody’s drops Rio Tinto to Baa1

Moody's Investors Service said it downgraded the senior unsecured ratings of all rated entities within the Rio Tinto Group, including Rio Tinto Ltd. and Rio Tinto plc, to Baa1 from A3.

The P-2 short-term rating was confirmed for all subsidiaries with short-term ratings.

The outlook is negative. This concludes the review for downgrade initiated on Jan. 21.

Moody’s said this action reflects its view that there has been a fundamental downward shift in the mining sector with the downturn being deeper and prospects for a recovery extended, resulting in increased credit risk and weaker metrics for Rio Tinto as well as the global mining sector. Consequently, ratings need to be recalibrated to reflect expected performance over a more protracted challenging operating environment.

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