S & P's Lowers Honduras' Sovereign Rating

Standard & Poor's has downgraded the sovereign rating of Honduras to "B" from "B +" with a stable outlook because of its diminished fiscal flexibility and increased debt burden.

Thursday, August 8, 2013

A statement from S & P:

Summary

Honduras' reduced fiscal flexibility and growing debt burden have made it vulnerable to external shocks or political problems.

We believe it is likely that the high level of central government deficit, of 6% of GDP in 2012 and this year, will increase the net government debt to 27% of GDP by the end of 2013 compared with 21% in 2012.

We have lowered our long-term sovereign ratings for Honduras' foreign and local currency to 'B' from 'B +'.

The stable outlook reflects our expectation that the political uncertainty in the country will decrease after the elections in November this year and that the new administration will take action to stem the erosion of its public finances.

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OVERVIEW
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From a statement from Standard & Poor's Ratings Services:

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