Guatemalan Debt Rating Confirmed

Citing a long history of fiscal and monetary policy characterized by prudent management, the rating agency Moody's maintained the country's credit risk rating in Ba1.

Monday, June 18, 2018

From a statement issued by the Bank of Guatemala:

June 2018. Moody's Investors Service maintains the credit risk rating for Guatemala at Ba1 with a stable outlook.  

The rating agency Moody's Investor Services published its annual report on Guatemala, in which it maintains the country's credit risk rating at Ba1, with a stable outlook. Moody's indicates that Guatemala's rating is the result of a long history of fiscal and monetary policies characterized by prudent management, as well as a demonstrated economic resilience to internal and external shocks. Moody's considers that the aforementioned aspects compensate, to some extent, the fact that Guatemala has a weak institutional framework and low income levels.  

The stable outlook reflects expectations of moderate economic growth and the commitment of the government to maintaining prudent fiscal and monetary policies, which will contribute to maintaining a level of public debt around the observed rate (24% of GDP), despite the pressures that could arise to meet social needs. 

Read full statement (in Spanish).

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More on this topic

Threats to Risk Rating

July 2019

Institutional problems and lower levels of economic growth compared to other countries with the same risk rating, could cause in the future a degradation of Guatemala's debt rating.

Although in its last evaluation Moody's decided to keep Guatemala's credit rating at Ba1 with a stable outlook, arguing that the economy reports stable growth, and that a prudent management of monetary and fiscal policy has been made, there are some threats for the rating to degrade.

Moody's Maintains Guatemala's Risk Rating

July 2019

Arguing that the economy reports stable growth, and that a prudent management of monetary and fiscal policy has been made, the agency decided to maintain in Ba1, with a stable perspective, the country's credit rating.

The low fiscal deficit caused by strict controls on public spending and reduced indexes of public indebtedness, as well as a demonstrated economic resilience to extra-economic events, are other of Moody's arguments.

Honduras Maintains Debt Rating

June 2019

Moody's kept the rating of long-term issues and senior unsecured bonds at B1, arguing that there is a "solid fiscal framework that has stabilized debt at lower levels compared to its rated peers.

Honduras' fiscal balance behaves favorably with respect to GDP and has been enough to stabilize overall government debt at around 41% of GDP, Moody's report explains.

Negative Outlook for Salvadoran Debt Rating

January 2013

Standard & Poor's placed has set El Salvador’s risk rating as ‘negative outlook’, indicating deterioration in the investment climate and growth of the fiscal deficit.

Last Friday Standard & Poor's Ratings (S & P) cut its forecast for El Salvador, arguing that the climate of increasing political polarization is weighing on investment and economic growth.

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Pacific Credit Rating Panamá

Organization that operates in Costa Rica, El Salvador, Guatemala and Panama.
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