“Junk” or “Rubbish”? Moody’s delays decision on Portugal’s “rating”

“Junk” or “Rubbish”? Moody’s delays decision on Portugal’s “rating”

Expected yesterday (Friday), financial ratings agency Moody’s has now delayed its update on Portugal’s “rating” until May 8.

Reporting on the news this morning, Ecónomico website says Moody’s has “not justified the reason for the new date”, but has simply stressed that its calendar for reporting on sovereign debt is “indicative”.

As the website pointed out, investors had been awaiting Moody’s decision “with expectation” as this was a week in which Portugal returned to long-term markets with the syndicated emission of five-year debt notes that brought in €3.25 billion.

The agency was also expected to pronounce on ratings for Malta, Lithuania and the Democratic Republic of the Congo. These too will now have to wait until May.

Moody’s last elevated Portugal’s rating in July, to “Ba1” – which negociosonline describes as “one step from leaving the rubbish classification – the category where investment in Portuguese debt is considered speculative”.

Meantime, S&P has rated Portugal at “BB”, “which corresponds to the second level of rubbish”, while Fitch has it at “BB+”, described as “the first level of junk”.

Elsewhere, a better rating has come from Canadian ratings agency DBRS, which has given Portugal a “BBB”, described as equivalent to “low – the last level of the investment category” but nonetheless “stable”.

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