Moody's cuts Venezuela country ceiling ratings
Thursday September 3, 1:59 pm Eastern Time
(Press release provided by Moody's Investors Service)
NEW YORK, Sept 3 - Moody's Investors Service today downgraded the country ceiling for foreign currency bonds and notes of
Venezuela to B2 and the country ceiling for foreign currency bank deposits to Caa1.
Consequently, all B1-rated bonds of the Republic of Venezuela, Banco Central de Venezuela, and other issuers domiciled in
Venezuela have been downgraded to B2. A list of the affected public-sector and corporate bonds is appended below.
A separate press release concerning ratings of Venezuelan banks is being issued simultaneously. Local currency denominated bonds of the Republic were downgraded
to Caa1.
Moody's noted that the Venezuelan authorities are continuing their unsuccessful attempts to control domestic liquidity, to contain the drain of international reserves, and
to rein in the fiscal deficit.
In a context of growing uncertainty, however, the reduction in the overall availability of financial resources for emerging markets is likely to place increased pressure on
Venezuelan macroeconomic conditions, while heightening the country's vulnerability to oil price volatility.
Consequently, the measures taken to date are not likely be enough to sustain the delicate balance of economic policies required until structural reforms are more firmly
rooted.
The fiscal adjustment effort relies mostly on large cuts in PDVSA's (the national oil company's) investment plan to help finance a widening of the central government
fiscal deficit.
Steep increases in domestic interest rates appear to have provided only little relief for the bolivar exchange rate in local markets, as reflected in dwindling international
reserves.
Outstanding B1-rated bonds of the following issuers are downgraded to B2: CANTV Finance Ltd. Petroleos de Venezuela, S.A. Venezuela, Republic of New York.
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Between columbia and the above.....seems to be Latam is ready to go the way of the world......... West Eur and the USA....islands in a world storm???? I think not.
Joel |
