Brazil Credit Rating Affirmed at S&P on ‘Prudent’ Policies

April 6 (Bloomberg) — Brazil’s investment-grade credit rating was reiterated by Standard & Poor’s as the government maintains “prudent” economic policies during the global recession.

Falling interest rates will improve growth and reduce the cost of government debt, while Brazil’s change to a net creditor from a net debtor will help shield the country from global turmoil, Standard & Poor’s analysts wrote today in a statement.

President Luiz Inacio Lula da Silva’s popularity also will be helpful in pushing through policy changes needed to confront “significant economic challenges” this year, the ratings company wrote. S&P expects Brazil’s economy to shrink 1 percent in 2009.

The stable outlook on the BBB- long-term credit rating, the lowest investment-grade level, is “supported by the government’s commitment to prudent macroeconomic policies,” the analysts wrote.

“The reaffirmation of this commitment remains critical for Brazil to protect the recent improvement in fundamentals and to regain a sustainable growth trajectory once the global economy stabilizes,” S&P said.

To contact the reporter on this story: Paulo Winterstein in Sao Paulo at  pwinterstein at

Bloomberg  April 6, 2009 15:46 EDT

Waldemar Jezler –

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