Photo: Moody’s Analytics


Just two days after the U.S. financial services rating agency Standard & Poor’s (S&P) revised its long-tern outlook for Mexico from negative to stable, Moody’s Analytics, another of the Big Three credit rating agencies, on Friday, July 8, downgraded the country’s sovereign bonds to Baa2, the next-to-last rung of investment grade, adding that Mexico’s economy will remain “constrained by weak investment prospects” and the “economic scarring” from the pandemic will not reverse.

A Baa2 rating, just two steps above junk, is considered as medium-grade debts, meaning that they are neither highly protected nor poorly secured. Bonds rated Baa and above are considered investment grade.

Moody’s Investors Service said that economic and fiscal trends in Mexico are expected to undermine the country’s overall credit profile.

Consequently, Moody said that is revised its outlook for Mexico from stable to negative.

“The rating downgrade was driven by economic and fiscal trends that Moody’s expects to continue to gradually –- but persistently -– undermine Mexico’s overall credit profile,” the agency said.

Fitch Ratings, the third agency of the Big Three, ranks Mexico one step lower.

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