scorecardresearch
Follow Us:
Saturday, June 12, 2021

Moody’s downgrades India’s rating, maintains negative outlook

Moody's Investors Service downgraded the Government of India's foreign-currency and local-currency long-term issuer ratings to Baa3 from Baa2 and also downgraded India's local-currency senior unsecured rating to Baa3 from Baa2.

By: PTI | New Delhi |
June 1, 2020 8:21:01 pm
‘Baa3’ is the lowest investment grade – just a notch above junk status.

Moody’s Investors Service on Monday downgraded India’s sovereign rating to ‘Baa3’ from ‘Baa2’, saying there will be challenges in implementation of policies to mitigate risks of a sustained period of low growth and deteriorating fiscal position.

“Moody’s has today downgraded the Government of India’s foreign-currency and local-currency long-term issuer ratings to Baa3 from Baa2.” Moody’s has also downgraded India’s local-currency senior unsecured rating to Baa3 from Baa2, and its short-term local-currency rating to P-3 from P-2. The outlook remains negative,” the agency said in a statement.

The negative outlook reflects dominant, mutually-reinforcing, downside risks from deeper stresses in the economy and financial system that could lead to a more severe and prolonged erosion in fiscal strength than Moody’s currently projects, it added.

“The decision to downgrade India’s ratings reflects Moody’s view that the country’s policy-making institutions will be challenged in enacting and implementing policies which effectively mitigate the risks of a sustained period of relatively low growth, significant further deterioration in the general government fiscal position and stress in the financial sector,” the statement said.

‘Baa3’ is the lowest investment grade – just a notch above junk status.

Moody’s had in November 2017, after a gap of 13 years, upgraded India’s sovereign credit rating by a notch to Baa2 from Baa3.

📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines

For all the latest Delhi News, download Indian Express App.

  • The Indian Express website has been rated GREEN for its credibility and trustworthiness by Newsguard, a global service that rates news sources for their journalistic standards.
Advertisement
Advertisement
Advertisement
Advertisement