Fitch downgrades Brazilian debt for the second time this year, Fitch Downgrades Brazil to Junk, With Negative Outlook. Fitch Ratings cut Brazil’s sovereign credit rating for the second time this year, citing the country’s ballooning budget deficit, political turmoil and a deeper-than-expected recession.
Fitch is the second of the big-three ratings companies, after Standard & Poor’s, to downgrade Brazil’s debt to junk, which could trigger a selloff of Brazilian assets and weaken the currency. It will also make it more expensive for the Brazilian government to borrow, at a time when Finance Minister Joaquim Levy is trying to cut the government budget deficit.
Prior post, Is Brazil’s economy heading to a depression?