Credit ratings: how Fitch, Moody's and S&P rate each country
Fitch has cut Spain's sovereign credit rating to BBB from A. See how different credit rating agency compare countries • Get the data • US debt ceiling analysed • Who owns America's debt?
Share 1180 Email
Credit ratings agencies judge each country's currency: Maria Toutoudaki/Getty Images
How do credit ratings vary by country and by ratings agencies? Fitch has slashed Spain's sovereign credit rating to BBB from A and given the country a negative outlook.
The credit rating agency announced the decision yesterday citing "the high fiscal cost of restructuring and recapitalizing the Spanish banking sector, and the likelihood that Spain will remain in recession through 2013" as the major factors precipitating the downgrade.
Larry Elliott, Heather Stewart and Josephine Moulds write:
Fitch said mistakes at a European level that had allowed the debt crisis to escalate were in part to blame for its decision to cut Spain's credit rating by three notches to just above junk bond status. The move – which follows the pattern that led to Greece, Ireland and Portugal needing help from Europe and the International Monetary Fund – makes it harder and more expensive for Spain to borrow money on the world's financial markets.
In a tense time for Europe, Moody's have cut the credit ratings of six German banking groups and Austria's three-largest banks. Greece had their rating slashed to CCC from B- by Fitch only two months after an upgrade following its debt restructuring deal.
In March the UK was given a warning by Fitch when the credit rating outlook was changed to negative, becoming the second ratings agency to put the treasured AAA rating at risk after Moody's made the same move. This signalled a "slightly greater than 50% chance" that Britain would lose its AAA rating with Fitch in the next two years.
There has been better news though - Honduras have had their long-term foreign and local- currency sovereign credit ratings raised by Standard and Poors, from B to B+ and given a stable outlook.
Elsewhere, Moody's downgraded its rating for Cyprus to Ba1 - junk status - and gave it a negative outlook back in March. The credit agency also took its rating for Greece down from Ca to C. The interactive below by Thiagu on Charts Bin shows how each country is rated. Click on the drop down menu to switch between credit rating agencies.
In February, the UK had the outlook on its Aaa Moody's rating changed to negative in a range of adjustments by the major credit agency including downgrades for Italy, Malta, Portugal, Slovenia, Slovakia and Spain.
At that time, Moody's also announced France and Austria would share the same fate as the UK with their outlooks being changed to negative.
The recent rating adjustments from Moody's echo the mass downgrade of nine eurozone countries by Standard & Poor's which saw France stripped of its coveted AAA credit last month. S&P also cut Austria's triple-A rating, and relegated Portugal and Cyprus to junk status. The agency downgraded the ratings of Italy and Spain by two notches and Malta, Slovakia and Slovenia were all cut by one notch.
Last August, America lost its AAA rating when S&P downgraded it to AA+, despite a deal being drawn to raise the US debt ceiling.
Earlier last year, Moody's re-assessed the credit ratings of several countries. Ireland had its credit rating slashed last year, down two notches to Baa3 - leaving it at just above junk status, with the verdict being delivered as the euro dropped against the dollar.
So, who are the ratings agencies? The big three agencies are Fitch, Moody's and Standard & Poors. What they do is assess how likely a borrower is to be able to repay its debts and help those trading debt contracts in the secondary market. That means for those trading debt contracts such as Treasury gilts after they have been issued, ratings agencies help assess a fair price to charge. Ratings agencies have been criticised for having too much clout in jittery markets during the financial crisis. They were widely attacked for failing to warn of the risks posed by certain securities, in particular mortgage-backed securities.
Losing your rating or being downgraded can have a fatal effect on your country's ability to borrow money on the markets.
Thanks to the three big agencies, we can bring you the ratings of countries around the world as of today. Because each agency's approach is slightly different, we have colour-coded them in three broad categories too. All the ratings have been updated today. Ratings for previous updates this year and from 2011 are in the spreadsheet, so you can see how ratings have changed over time.
Can you do something with the data? Data summary Credit ratings by agency and country - Updated 8th June 2011
Click heading to sort table. Download this data FITCH S and P MOODYS MOODYS Fitch S and P Country OUT OUT RATING OUT LOOK RATING RATING LOOK LOOK Red: junk, Orange: under observation, Green: top notch NEG: Negative; POS: Positive; STA: Stable; RUR: Rating under review; DEV: Developing outlook Albania B1 STA B+ STA Andorra (Principality A NEG of) Angola Ba3 STA BB- STA BB- STA Argentina B3 STA B STA B STA Armenia Ba2 NEG BB- STA Aruba BBB STA A- STA Australia Aaa STA AAA STA AAA STA Austria Aaa NEG AAA STA AA+ NEG Azerbaijan Ba1 POS BBB- POS BBB- NEG Bahamas A3 NEG BBB STA Bahrain Baa1 NEG BBB STA BBB NEG Bangladesh Ba3 STA BB- STA Barbados Baa3 NEG BBB- NEG Belarus B3 NEG B- NEG Belgium Aa1 RUR- AA+ NEG AA NEG Credit ratings by agency and country - Updated 8th June 2011
Click heading to sort table. Download this data FITCH S and P MOODYS MOODYS Fitch S and P Country OUT OUT RATING OUT LOOK RATING RATING LOOK LOOK Belize B3 STA B- NEG Benin B STA B STA Bermuda Aa2 STA AA+ STA AA- STA Bolivia B1 POS B+ STA B+ POS Bosnia and WATCH B2 NEG B Herzegovina NEG Botswana A2 STA A- STA Brazil Baa2 POS BBB STA BBB STA Bulgaria Baa2 STA BBB- POS BBB STA Burkina Faso B STA Cambodia B2 STA B STA Cameroon B STA B STA Canada Aaa STA AAA STA AAA STA Cape Verde B+ STA B+ STA Chile Aa3 STA A+ STA A+ POS China Aa3 POS A+ STA AA- STA Colombia Baa3 STA BBB- STA BBB- STA Cook Islands B+ STA Costa Rica Baa3 STA BB+ STA BB STA Croatia Baa3 STA BBB- NEG BBB- NEG Cuba Caa1 STA Curacao A- NEG Cyprus Ba1 NEG BBB NEG BB+ NEG Czech Republic A1 STA A+ POS AA- STA Denmark Aaa STA AAA STA AAA STA Dominican Republic B1 STA B POS B+ STA Ecuador Caa2 STA B- STA B- POS Egypt B1 NEG BB NEG B+ NEG El Salvador Ba2 STA BB STA BB- STA Estonia A1 STA A+ STA AA- NEG Fiji B1 NEG B STA WATCH Finland Aaa STA AAA STA AAA NEG France Aaa NEG AAA STA AA+ NEG Gabon BB- STA BB- STA Georgia Ba3 STA B+ POS BB- STA WATCH Germany Aaa STA AAA STA AAA NEG Credit ratings by agency and country - Updated 8th June 2011
Click heading to sort table. Download this data FITCH S and P MOODYS MOODYS Fitch S and P Country OUT OUT RATING OUT LOOK RATING RATING LOOK LOOK Ghana B+ STA B STA Greece C DEV CCC NEG SD NEG Grenada B- STA Guatemala Ba1 STA BB+ STA BB NEG Guernsey AA+ STA Honduras B2 STA B+ STA Hong Kong Aa1 POS AA+ STA AAA STA Hungary Baa3 NEG BBB- NEG BB+ NEG Iceland Baa3 NEG BB+ STA BBB- STA India Baa3 STA BBB- STA BBB- STA Indonesia Ba1 STA BB+ POS BB+ POS Ireland Ba1 NEG BBB+ NEG BBB+ NEG Isle of Man Aaa STA AA+ STA Israel A1 STA A STA A+ STA Italy A3 NEG A+ NEG BBB+ NEG Jamaica B3 STA B- STA B- NEG Japan Aa3 STA AA NEG AA- NEG Jordan Ba2 NEG BB NEG Kazakhstan Baa2 STA BBB POS BBB+ STA Kenya B+ STA B+ STA Korea A1 STA A+ POS A STA Kuwait Aa2 STA AA STA AA STA Latvia (Republic of) Baa3 POS BBB- POS BB+ POS Lebanon B1 STA B STA B STA Lesotho BB- NEG Liechtenstein AAA STA Lithuania Baa1 STA BBB POS BBB STA Luxembourg Aaa STA AAA STA AAA NEG Macedonia BB+ STA BB STA Malaysia A3 STA A- STA A- STA Malta A3 NEG A+ STA A- NEG Mexico Baa1 STA BBB STA BBB STA Mongolia B1 STA B+ STA BB- STA Montenegro Ba3 STA BB NEG Morocco Ba1 STA BBB- STA BBB- STA Mozambique B STA B+ STA Monstserrat Namibia Baa3 STA BBB- POS Credit ratings by agency and country - Updated 8th June 2011
Click heading to sort table. Download this data FITCH S and P MOODYS MOODYS Fitch S and P Country OUT OUT RATING OUT LOOK RATING RATING LOOK LOOK WATCH Netherlands Aaa STA AAA STA AAA NEG New Zealand Aaa STA AA STA AA STA Nigeria BB- STA B+ STA Norway Aaa STA AAA STA AAA STA Oman (Sultanate of) A1 STA A NEG Pakistan B3 STA B- STA Panama Baa3 POS BBB STA BBB- POS Papua New Guinea B1 STA B+ STA Paraguay B1 STA BB- STA Peru Baa3 POS BBB STA BBB STA Philippines Ba2 STA BB+ STA BB STA Poland A2 STA A- STA A- STA Portugal Ba3 NEG BBB- NEG BB NEG Qatar Aa2 STA AA STA Romania Baa3 STA BBB- STA BB+ STA Russia Baa1 STA BBB POS BBB STA Rwanda B STA B POS San Marino A NEG Saudi Arabia Aa3 STA AA- STA AA- STA Senegal B1 STA B+ NEG Serbia BB- STA BB STA Seychelles B STA Singapore Aaa STA AAA STA AAA STA Slovak Republic A2 NEG A+ STA A NEG Slovenia A2 NEG AA- NEG A+ NEG South Africa A3 NEG BBB+ STA BBB+ STA South Korea Spain A3 NEG BBB NEG A NEG Sri Lanka B1 POS BB- STA B+ POS Suriname B1 STA B+ STA BB- STA Sweden Aaa STA AAA STA AAA STA Switzerland Aaa STA AAA STA AAA STA Taiwan Aa3 STA A+ STA AA- STA Thailand Baa1 STA BBB STA BBB+ STA Trinidad & Tobago Baa1 STA A STA Tunisia Baa3 NEG BBB- NEG BBB- NEG Turkey Ba2 POS BB+ POS BB POS Credit ratings by agency and country - Updated 8th June 2011
Click heading to sort table. Download this data FITCH S and P MOODYS MOODYS Fitch S and P Country OUT OUT RATING OUT LOOK RATING RATING LOOK LOOK Uganda B STA B+ STA Ukraine B2 STA B STA B+ STA United Arab Emirates Aa2 STA AA STA AA STA (Abu Dhabi) United Arab Emirates (Emirate of Ras Al Aa2 STA A STA Khaimah) United Kingdom Aaa NEG AAA NEG AAA STA United States Aaa NEG AAA STA AA+ NEG Uruguay Ba1 STA BB POS BB+ STA Venezuela B2 STA B+ STA B+ STA Vietnam B1 NEG B+ STA BB- NEG Zambia B+ STA B+ STA Download the data
• DATA: download the full spreadsheet More data
Data journalism and data visualisations from the Guardian World government data
• Search the world's government data with our gateway Development and aid data
• Search the world's global development data with our gateway Can you do something with this data?
• Flickr Please post your visualisations and mash-ups on our Flickr group • Contact us at [email protected] • Get the A-Z of data • More at the Datastore directory • Follow us on Twitter • Like us on Facebook
Posted by Simon Rogers, Ami Sedghi & John Burn-Murdoch Friday 8 June 2012 14.50 BST guardian.co.uk
Comments (…)
Article history
World news
Ireland · Greece · European Union · Spain · Portugal · United States · Debt relief · Italy · Austria · France · Malta · Slovenia · Slovakia · Honduras · Europe
Business
Economics · Eurozone crisis · IMF · Ratings agencies · Financial sector · Market turmoil
Politics
George Osborne More from Datablog on
World news
Ireland · Greece · European Union · Spain · Portugal · United States · Debt relief · Italy · Austria · France · Malta · Slovenia · Slovakia · Honduras · Europe
Business
Economics · Eurozone crisis · IMF · Ratings agencies · Financial sector · Market turmoil
Politics
George Osborne
More blogposts
More graphics
Eurozone crisis: Banking sector could be 'wiped out' if weakest nations leave Analysis by Credit Suisse estimates that up to 58% of the value of Europe's banks could be wiped out by the departure of the 'peripheral' countries
Eurozone crisis live: Italian borrowing costs jump at bond sale Eurozone crisis: Greece faces an agonising election choice IMF chief Christine Lagarde warns world risks triple crisis Greece
Syriza candidate jumps ship days before election
The unexpected defection of one of Syriza's leading candidates sends shockwaves through ranks of leftist party, says Helena Smith
Precarious funding pushes health and social services to extremes Syriza and New Democracy clash over Spanish bailout Alexis Tsipras – kingmaker or deal breaker? Spain
Hurried Spanish banking bailout fails to calm nerves
Spain's borrowing costs rise closer to levels considered unsustainable – dragging Italy towards danger zone
Buy Facts are Sacred - the Power of Data ebook
1. Buy for Kindle (UK) - £2.99 2. Buy for Kindle (US) - $4.61 3. Buy for iPhone, iPad or iPod touch (UK) - £2.99 4. Buy for iPhone, iPad or iPod touch (US) - $3.99 5. Learn more about Guardian Shorts
Next Previous Blog home
Share Email Ads by Google
How to get to Slovenia?
GoOpti - Low cost shuttle from Italian and Austrian airports
www.GoOpti.com
Hotel Roissy 3* Lourdes
The nearest from the Sanctuary Newly refurbished and Free Wifi !
www.lourdes-roissy.com
Apartments in Italy
Porto San Giorgio - 200 meters from the sea, we sell new apartments
www.structura.net Comments
87 comments, displaying first
Staff Contributor
Open for comments. Sign in or create your Guardian account to join the discussion.
Latest 1 2 Next All
jlbrown3
30 April 2010 11:57AM
Has Irelands rating recovered any due to their austerity measures?
o Recommend? (18) o Responses (0) o Report o Link
stitchups
1 May 2010 10:35AM
Before journalists give any more weight to Standard & Poor´s credit ratings to assist them in the self-fulfilling prophecy game ( just look at the way the world´s stock markets reacted to this week´s news) they ought to have an in depth look at the company´s own ratings.
Having failed to predict the financial crisis, they also failed to predict the failings of Iceland´s two largest banks. It appears other failures have led to huge losses for some investors. At best it seems their ratings are standard, and at worst, they are sometimes very poor.
As I began, with the self-fulfilling prophecy factor taken into consideration, perhaps journalists should give their reports far less credit than they do at the moment. The press have given them so much coverage and credibility this week you could almost believe they are the PR wing of the company.
That confidence is certainly not based on history. By now we should all be very sceptical about anything coming from any international authority dealing with our money. Formerly lauded financial gurus, such as Alan Greenspan, and organisations like the IMF, have records of consistent failure when they have meddled with nations´ economies. But they have not had to suffer the consequences of their meddling, the ordinary people of those nations have. Let´s get real. None of the large financial institutions, their advisors, or any state regulating authority, predicted the present financial crisis, yet all the evidence was there. Economists, who did see it coming, were ignored and even derided.
These reports, scandalously wrong far too often, don´t just affect the stock markets and bankers - poor dears, losing all that money and even having their bonuses threatened - they affect huge numbers of the impoverished all over the world, and now threaten the poor of Europe with even more poverty.
Greece isn´t bankrupt, the system is. Bankrupt of ideas and bankupt of ideals. Democracy is being threatened by globalised organisation simply by the fact that nobody votes for them, and yet their policies and assessments of our economies are acted on at government level. These policies take away our livelihoods and our homes unnecessarily far too often. There is almost no accountability whatsoever.
They love to tell us it´s easy to be clever in hindsight. Well, if you take all the information into account, and not just information from those who have a financial stake in the outcome, it´s not quite so hard to predict the future so inaccurately either. Some did. After all isn´t that what they´re getting paid for? Payment on results would provide strong incentive for banks and their advisors to be rather more cirmcumspect when making decisions of worldwide importance.
o Recommend? (265) o Responses (0) o Report o Link
stitchups
1 May 2010 10:44AM
" ...it´s quite not so hard to predict the future so inaccurately either..."
I don´t think I quite meant that. Even I´m not sure what that clause adds up to, Standard to poor is my literary evaluation. Anyway, I think readers will get the gist.
o Recommend? (7) o Responses (0) o Report o Link Danns
2 May 2010 2:11PM
Moodys graded too generous for Greace. this country is not deserved to be A3.
o Recommend? (9) o Responses (0) o Report o Link
RobertSchuman
20 July 2010 9:09AM
The rating agencies don't add value as the fact basis for their ratings appears to be on thin ice and isn't transparent at all. Unless there is an independent agency and the assessments are detailed and transparent there is no point in listening to ratings.
o Recommend? (28) o Responses (0) o Report o Link
greatgrapeape
22 July 2010 8:05AM
As long as debt markets exist, i.e people are able to make money of other's ultimate misery, these agencies will continue to publicly post their garbage and set the markets on their weekly rollercoaster journey. It's a self-propagating economic system that can only end in tears.
As ever, all we need to do as a global community is look at who gets rich off of data like this - the same elite that control the companies publishing this data. Change our thinking, change our planet. The latest financial depression has been nothing more than a blatant redistribution of wealth.
How long will we allow this to continue? When 1% of the world's population controls 99% of the money?
There's a graph I'd like to see - that trend in the last ten years would be a bitter pill to swallow.
o Recommend? (54) o Responses (0) o Report o Link
Elfy
25 March 2011 7:32PM
It would be useful if, when you click to sort by a particular column, it would sort it in the order they're ranked in, rather than alphabetically by the letters the ratings agency choose to signify their ranking.
Sorting by Moody's, for example, results in a list that first has countries that have no ranking at all, then what I think are the fifth tier, then the sixth, seventh, second, third, fourth, first, then what's possibly the twelfth, though I'm really not sure of any of these. It's not very helpful.
o Recommend? (3) o Responses (0) o Report o Link
MeinHerzBrent
25 March 2011 9:50PM
Stitchups
Greece isn´t bankrupt, the system is. I LOL'd. Scarcely a decade goes by without the Greek government going bankrupt. The difference under the Euro is that they can't print a load of fresh money to inflate their way out of bankruptcy, because those nasty Germans want to protect the value of their savings.
o Recommend? (68) o Responses (1) o Report o Link
Briantist
15 April 2011 5:57PM
A key for what the ratings mean for each ratings agency works would have been handy. Baa3 Baa3 Black Sheep?
o Recommend? (10) o Responses (0) o Report o Link
Briantist
15 April 2011 5:58PM
Robert Schuman:
The rating agencies don't add value as the fact basis for their ratings appears to be on thin ice and isn't transparent at all. Unless there is an independent agency and the assessments are detailed and transparent there is no point in listening to ratings.
A fine assertion, but where is your evidence?
o Recommend? (2) o Responses (1) o Report o Link
Briantist
15 April 2011 6:01PM
stitchups: To be honest, I think you might be confusing the term ratings agency with the concept of an oracle.
o Recommend? (3) o Responses (0) o Report o Link
harmonyfuture
15 April 2011 8:37PM
I view these agencies with the same scepticism I view many so called financial advisers in as much as the temptation to present biased information for their own gain can blur the truth. If we are happy to allow such unregulated, un-monitored, non-appointed and plainly self serving organisations to dictate the financial security of any countries economy, then the system is doomed to failure.
o Recommend? (34) o Responses (0) o Report o Link
echinoderm
16 April 2011 1:33AM
I'm not sure what the above posters are criticizing.
Maybe the ratings agencies are crap at advising investors so anyone wanting to buy debt better rely on their own judgement - as usual. Or maybe they are part of a conspiracy to shift cash from the masses to the wealthy - maybe they are consciously or unconsciously? I don't know.
It's all the Tragedy of the Commons, just like everything else we all do. Get in there and make some profit while the going's good and get out quick before the exodus becomes a stampede. It may destroy the wealth (and lives) in the end but if you don't profit in the mean-time someone else will.
As usual I'd like to hear about a better system from the current system's critics.? Short answers?
o Recommend? (11) o Responses (0) o Report o Link
echinoderm
16 April 2011 2:01AM
As for the map: there's China. Well they are coming from a very low base after a century of mistakes and corruption when traditionally they have often been economic stars in the past 1000 years. Japan looks good, they are a focused and rigidly ordered society that has learnt from its mistakes. Both are homogeneous with citizens who understand who they are and their place in society.
Chile, who knows? Maybe like Saudi Arabia they have lots of resources under them for the taking.
The rest are Anglo-Saxon protestant, they made the system that supports the massive population of consumers on the planet today through their hard work and competitive attitude. In North America and Australia the land was wiped clean of the aboriginal people for Europeans to do their thing. You can see that Israel is 'High grade' blue where this is happening even now.
In these areas people -as a generalisation - are increasingly judged more by their wealth than their race or culture and the Devil take the hindmost.
Globally, take care if you want to change the system - there ain't much slack anymore to accommodate mistakes.
o Recommend? (14) o Responses (0) o Report o Link
R1ckr0ll
18 April 2011 8:29AM
I cannot believe they all think so wonderfully of the US. We're a mess over here. But maybe it's our issues that will occur in the next 10 years or so because of the crap that our Congress has pulled...
o Recommend? (4) o Responses (1) o Report o Link
R1ckr0ll
18 April 2011 8:34AM
How long will we allow this to continue? When 1% of the world's population controls 99% of the money?
There's a graph I'd like to see - that trend in the last ten years would be a bitter pill to swallow.
Hard to say this hasn't already happened. I commend your statement and i wish more people cared that they are playing the devil's game and throwing around not even money, but DEBT. It's a sad sad world when debt becomes an industry. Now that i think about it, America's prime and only industry these days is Debt circulation.
Even worse than the trend is the acceptance of it as if it were some sort of inevitability.
o Recommend? (17) o Responses (0) o Report o Link Robgallen
18 April 2011 1:37PM
Nah.
What they do is rock up to work around midday and get pissed up in their local bank- converted-into-a-gastro-bar discussing ways to make themselves richer. Then they start selling off one country's currency before downgrading it just for a laugh. Then they head back to the wine bar to discuss what car/yacht/penthouse they're going to buy next.
o Recommend? (23) o Responses (0) o Report o Link
bekibunny
1 August 2011 5:42PM
I realised that these ratings are not tied to reality when I saw that France has a higher rating than China....
o Recommend? (17) o Responses (0) o Report o Link
stomachtrouble
1 August 2011 5:57PM
The ratings agencies are curiously non-recursive. If they self-applied their own algorithms, based on past history, they would have ratings well back in negative territory and be out of business. Of course, they won't downgrade the world's biggest debtor nation with a ballooning debt/GDP ratio, near stagnant growth and unemployment at a stubborn 9%. To the uninitiated that might suggest consistency, but for the US based agencies, it would mark political suicide.
The agencies have not just been frequently wrong, they have been staggeringly stupendously wrong. That they retain any credibility at all says much about the gullibility of politicians. If the EU political establishment collectively decided to brush off Moody's, Fitch and the S&P, the agencies would melt down. That day will come, that it hasn't yet after the catastrophe of 07/08 CDS valuations may appear mystifying. In fact, the agencies require a deluded supine relationship with Wall Street for their continued 'credibility' and that my friends is why the US will not be marked to junk.
o Recommend? (41) o Responses (0) o Report o Link
Greywater
1 August 2011 7:06PM
Oh.
http://www.guardian.co.uk/business/2011/apr/19/geithner-shrugs-off-credit-rating- warning?intcmp=239
o Recommend? (2) o Responses (0) o Report o Link
veragottlieb
1 August 2011 7:10PM
By now it is well known that these 3 rating agencies issued totally misleading ratings during the 2008/09 financial crisis - receiving payments from those companies whose "junk" bonds were being rated AAA or such. So why do we keep paying attention to these crooks? Why should the credit rating of the US not be lowered? It should have been lowered ages ago as it has been the biggest debtor nation for many years. These rating agencies sink foreign nations but when it comes to the US...When will the world stop crawling up America's rectum???
o Recommend? (38) o Responses (0) o Report o Link
Corcaioch
1 August 2011 9:28PM
These ratings companies were giving AAA ratings to Ireland until the moment that the housing bubble collapsed.
If that's how poor their forecasting is, why are we paying much attention to them. Seems just to be another abstract notion with no empirical support to scare us into accepting bail-outs for banks and cuts to public services.
o Recommend? (24) o Responses (0) o Report o Link
Scipio1
1 August 2011 10:23PM
The US and UK top notch AAA - give me a break! The Chinese ratings agency Dagong has rather a different view giving both AA+ negative, and putting them 25 and 26 behind the real AAA top-notch states. Why such a discrepancy one wonders. Maybe it is because all the aforementioned agencies are based in the US. Possibly they are influenced by all the Anglo-American hype, who knows? But their estimates seem seriously out of whack.
o Recommend? (67) o Responses (0) o Report o Link
amrit
2 August 2011 2:45AM
The comments on the other data set are closed.
However I have two questions:
We are in the year 2011 hoever data in that chart goes to many years further.
Also it is telling that democrats will be guys in power in many years to come.
How could we believe such data??
o Recommend? (2) o Responses (0) o Report o Link
jascow
6 August 2011 2:14PM
Lovely to see the UK with the same credit rating as Germany - both of them top notch.
Thanks George Osborne and Danny Alexander!
o Recommend? (9) o Responses (0) o Report o Link
frontalcortexes 6 August 2011 3:04PM
Standard & Poor. The people who took bribes to rate mortgage bonds. Now their holding company chairman, Terry McGraw, is hyping Mitt Romney for the Presidency by aiding Romney's silly Neo-Liberal line that the US is near bankruptcy. Neither Terry McGraw, the chairman of McGraw Hill who own S&P or Mitt Romney understand what a sovereign currency is, how it works and what it can be used for.
o Recommend? (16) o Responses (0) o Report o Link
batleybulldog
6 August 2011 3:34PM
How did banks get so much power? These gradings need to be independent. How can you trust gradings from organisations which possibly have their have their own political agenda?
o Recommend? (11) o Responses (0) o Report o Link
frontalcortexes
6 August 2011 3:50PM
This comment was removed by a moderator because it didn't abide by our community standards. Replies may also be deleted. For more detail see our FAQs.
PacoFleyas
6 August 2011 4:14PM Why on earth are this lot still being given any credibility at all - never mind this self induced global panic that a bunch of discredited tipsters who underwrote sub-prime with such gold plated confidence has induced. If their track record is anything to go by the States could just have turned the corner. They should be re-named Poor Standards!
o Recommend? (13) o Responses (0) o Report o Link
saagua
6 August 2011 5:33PM
1, S&P is one of three principal raters. The other two have not downgraded US debt. 2. S&P has a terrible record of being wrong. E.G., it gave Lehman Bros. an A rating just before Lehman collapsed into bankruptcy. It also gave investment grade ratings to sub prime mortgage bonds that all turned completely sour. 3. The market is the final arbiter and it says US credit is as good as that of Germany and the UK.
o Recommend? (8) o Responses (0) o Report o Link
giltedged
6 August 2011 6:27PM
This comment was removed by a moderator because it didn't abide by our community standards. Replies may also be deleted. For more detail see our FAQs.
Dalma1
6 August 2011 8:35PM Is this the same Standard & Poor's who's given Lehman Brother's a AAA rating right up until they've filed for bancrupcy protection in 2008?
o Recommend? (10) o Responses (0) o Report o Link
heebeegeebies
6 August 2011 9:30PM
It seems S & P have a record of over stating the credibility of debtors. So perhaps we should be more concerned that they still rate the USA so highly?
I am curious though why the credit agencies opinion of the USA trustworthiness regarding its debt is questioned, when these uncertainties are not voiced about their ratings of anyone else.
o Recommend? (2) o Responses (0) o Report o Link
loveyk
7 August 2011 12:28AM
Trillion dollars in debt. It is no small wonder we had managed to retain an AAA credit rating with S&P! That anyone who is actually surprised by the downgrade surprises me. Where have you all been living for the past couple of decades? Underneath a rock? Out of control spending, coupled with tax breaks for the wealthy (in a false pretense of "trickle-down-economics") have existed before Obama. The latter is just a sad tool for the corporate bankers and wall street investors. A good orator he may be, but the face of the administration is the only thing that has changed in the decade. Imperialism is still at large, two continuing wars, corporate tax loopholes, continued tax breaks for the wealthy- when our children start crippling from the strain perhaps then we might wake up. If there was any true voice left in the average american blue collared worker, then I have not heard it in decades. Regarding S&P:
While S&P may be only one of three, and while it may have misjudged in the past, I think their reasoning is pretty spot on with this decision. If it takes a downgrade to kick the shins of those in office, then so be it.
o Recommend? (4) o Responses (0) o Report o Link
pichard
7 August 2011 1:52AM
@bekibunny
"I realised that these ratings are not tied to reality when I saw that France has a higher rating than China...."
Is the UK economy in much better shape than that of France? The French just sold several aircraft carriers to the Russians at a time when we are scrapping defence contracts in this country!... They are a major stakeholder in Airbus (see record breaking orders of the revamped A320 at Paris air show last June)...And who is going to build our new nuclear plants?...
I am not saying that they compare to China but why single out France as their economic situation is probably better than ours at present.
o Recommend? (14) o Responses (0) o Report o Link
pichard
7 August 2011 2:30AM
@bekibunny Britain's external debt is almost twice that of France. France's GDP is slightly above that of the UK.
o Recommend? (13) o Responses (0) o Report o Link
smilerone
7 August 2011 5:24AM
Gosh Canada may be dull and boring at times but its a safe harbour to be during this financial storm.
Another exciting night in Vancouver draws to a close.
o Recommend? (6) o Responses (0) o Report o Link
stepheninnewyork
7 August 2011 6:21AM
This is all very, very upsetting and kinda crazy.
Why is the media not asking the obvious question? Why did Goldman Sachs allow this to happen?
The idea that S&P is somehow 'independent' is surely ludicrous. I was a financial journalist in Hong Kong in 1997 - same old, same old. Bond traders would actually lie to me on a regular basis, then gladly confess 'after the deal was done'.
The key thing is to understand who benefits from credit ratings. In the US (unlike other parts of the world, actually), credit ratings are CRUCIAL in pricing loans and bonds. With the US downgrade potentially TRILLIONS of dollars worth of debt could be re- priced by the banks upwards cos its 'more risky'. Fabulous!!!
The US market is SO MUCH BIGGER than everywhere else this is a huge deal. I used to live on Pearl Street in Manhattan - from my window I could see S&P HQ, and our front door faced Goldman's (former) global HQ.
Yeah, really.
o Recommend? (11) o Responses (0) o Report o Link
stepheninnewyork
7 August 2011 6:26AM
And people, having lived in China, and having my phones tapped, before moving to New York, please stop with the bullXX about China's credit ratings or whatever.
China is like Obama sitting in an office and deciding what (a) S&P, Moody's & Fitch do (B) what CNN, Fox, NBC, ABC etc report
I have friends with broken knees, my phones tapped etc, so stop with the China is paradise crap. Millions of Chines live in abject poverty - go friggin travel the place and see it. Hitler's Germany was booming in the 1930s..read for frigs sake.
o Recommend? (10) o Responses (0) o Report o Link
sciencebod
7 August 2011 6:40AM Rating agencies? Berating agencies more like it, whose dissing reports quickly become self-prophesying. Whether realized or not, the potential for a mafia-style protection racket is unlimited...
o Recommend? (5) o Responses (0) o Report o Link
santos25
7 August 2011 9:10AM
I must laugh at some of the ratings.
We here in Australia have unemployment of 4.7%, relatively low government debt, unfortunately a high private debt level, interest rates for a one year deposit are 6.5% and a positive balance of trade.
Yet Fitch only gives a rating of AA+.
At least the other lot gave as AAA.
As long as China is doing well we are smiling. Who gives a stuff about the US or Europe. The Chinese and Japanese are the savers in this world and they will eventually call the shots.
Funny thing is that saving isn't all that hard. I did all my life and i am sleeping soundly among all that mayhem.
o Recommend? (10) o Responses (1) o Report o Link
Bruce2
7 August 2011 11:31AM Does the US credit rating downgrade matter that much? And to who?
If the US has already issued Treasury bonds to cover all of the $14.2 trillion debt it has, how does a downgrade affect the actual amount that the US has already agreed to pay on those Treasury bonds it has already issued?
Won't the downgrade only increase the interest the US has to pay on subsequent NEW Treasury Bonds it issues?
Won't the downgrade only reduce the current tradeable value of already issued Treasury bonds? Won't this only affect the wealth of those currently holding US Treasury bonds? Has this led to China's criticism? Who else 'owns' all those US Treasury bonds?
o Recommend? (0) o Responses (0) o Report o Link
SymphonyMusic
7 August 2011 11:58AM
Credit ratings are only meant to be a tool. Individuals who commit real money are only meant to refer to them to come to real world conclusions about investing real world money into a particular financial instrument. All the comments and articles I read seem to rely on the rating as a report card, not relevant to their primary purpose.
As this is a trend, and the whole issue seems to be about trust in the American system, I would really like to see a comparison of the world's important economic and geographic regions. In that analysis, I would like to see a ranking of their different infrastructure support systems. Items/issues to consider should include a region's political process, for sure, but also items such as their legal systems, accounting systems, regulatory enforcement systems, tax system, women's rights, existing road/transportation & communication infrastructure, etc.
As China, Europe, Russia, and India throw stones, it will be interesting to see the relative value of these points. It would seem that the lack of product liability enforcement pretty much destroys the credibility of China. The breadth of poverty and lack of homogenous development in India and Russia makes that difficult. Dis-united Europe, not held to one credit rating standard, makes any individual's sovereign commentators comments suspect.
o Recommend? (0) o Responses (0) o Report o Link
rCharel
7 August 2011 4:52PM
When I look at this list I cannot escape the idea that these US credit rating agencies reflect a distinctive US political view of risk. Any country thought of as anti US is rated as very poor and allies, no matter what risk get good grades.
Follow the flavour of the month they claim and your money is safe. Until the sh*t hits the fan and you will loose your deposit. Though luck if you believed us in the past and even tougher luck if you believe us now.
o Recommend? (13) o Responses (0) o Report o Link
brandonfmg
8 August 2011 5:11PM
This is a great article! It shows that plainly explaining a topic doesn't have to mean skimping on facts and statistics. It actually inspired us to put together a video for a U.S. audience that explained our recent credit downgrade. http://www.fmgsuite.com/market- in-motion/?p=319
o Recommend? (1) o Responses (0) o Report o Link
Dimir 9 August 2011 5:02AM
Much thanks for the down grade Tea-baggers. It will help with the deficit tremendously.
And, even greater props to you, O-coward. I suppose it wasn't enough that you put all those big money fellows on your staff. Good thing you short sheeted Ms. Warren too.
o Recommend? (1) o Responses (0) o Report o Link
DKBose2000
10 August 2011 5:13AM
I used to work for the Standard & Poor. It has forecasting models for most of the countries of the world, for most of the commodities, for exchange rates between the countries, for trade flows between the countries etc etc .
Using these forecasts based on detail statistical models, heads of each section finalise their senarios and alternative senarios taking into account of the risks, various international events and so on. Based on that a country's future can be evaluated. Thus, these are not guess work or political propaganda, but whatever complexity one can imagine would go into the construction of these models.
USA is in a bad situation and it is responsible for that due to two main factors, which this Korean Lecturer completely ignored. First factor is the gigantic defence expenditure which is causing budget deficits. The second factor is the imports from China, which has destroyed USA's manufacturing industries except for those in high technology areas, which China could not master.
These two factors have caused net foreign liability for USA, it has no net foreign assets any more. It is like your total debts are more than your assets. Thus, it is dangerous to lend you money unless you change your behaviour. That is exactly what Standard & Poor implicitly suggested.
The solutions are very clear: reduce Defence expenditure seriously and impose tariff against China.
All other issues like restructuring financial sector etc have nothing much to do with the current problem of USA. o Recommend? (3) o Responses (1) o Report o Link
DebtRelief
27 August 2011 9:39AM
S&P’s decision of downgrading U.S. credit rating have forced global investors to park their money in yellow metal as gold being the safest investment and hedge against global economic instability. Its amazing how people cant see the overall bigger picture that this is just the end of the biggest transfer of wealth in history, and planned 3rd worlding of america while everyone believes things are about to get better with the delivery of some miracle or other.
o Recommend? (5) o Responses (0) o Report o Link
TCondon
3 October 2011 10:07AM
What I find difficult to understand in regards to the ratings system is the transparency of the decisions in regards to how the defined rating was obtained. Questions must be raised in regards to this methodology in that if it is mathematical (which it should be rather than a personal opinion) then we should be provided with the proof.
This week New Zealand was down graded from AAA to AA+. In regards to the country it is trading reasonably well considering the environment. In regards to measuring the average per capita financials against other developed countries such as the USA and most European New Zealand appears to be doing extremely well.
The country has not only made it through the world recession almost unscathed but they were still able to post positive growth after suffering a major natural disaster which partially destroyed its second largest city which represented approximately 17% of our GDP (the value of the damage is estimated at 17 billion (US)). I accept that the government does need to make some difficult decisions around monetary policy to ensure our debt does not get out of control (similar to other developed countries New Zealand has borrowed money to finance a high proportion of its recent expediture - as I understand the finance option was cheaper than using its own capital reserves). In addition the market place needs to be freed up a little more to remove some of the barriers to trade and allow further foreign investment into the country. These are always ongoing.
However, compared to what little leadership and direction that I have seen from the USA and Europe I still find what happened to the New Zealand credit rating as a difficult pill to swallow.
Maybe New Zealand needed to be downgraded but the rating agencies need to look seriously at themselves and answer the question of why other countries like the USA (USA have been downgraded by one ratings group), UK, France, etc are not also being downgraded. Maybe its because New Zealand are only 4 million strong and they can be used as the lab experiment for how the ratings agencies will treat other developed countries.
The New Zealand economy is no bowl of roses however it sure smells better than the bowl that Europe and the USA are swirling around in.
o Recommend? (2) o Responses (0) o Report o Link
MonaLisa4ever
6 December 2011 6:52PM
Response to MeinHerzBrent, 25 March 2011 9:50PM
"because those nasty Germans want to protect the value of their savings"
Those nasty Germans should do a bit more to protect their savings than vilify all the small countries in EU. I would pay attention to the downgrade of the German banks that carry an undisclosed amount of toxic assets from sovereign/consumer/corporate debt. The German banks are on the hook for some heavy sums in 2012 and, if they go down, they will take Germans' savings with them.
And one more word of caution: When a country depends on others like Germany does on the periphery for exports, it should try not to piss those guys off too too bad, as they are the key to manufactuing orders and jobs in Germany. Playing the 'we are Oh so mighty" card to the millions of unemployed masses in EU can always backfire. Credit rating
From Wikipedia, the free encyclopedia Jump to: navigation, search
S&P's ratings of European countries (May 2012): AAA AA A BBB BB B CCC CC C Default no rating
World countries by Standard & Poor's Foreign Rating:[1][2] Lighter blue - Green - AAA Purple - A Turquoise - BB Dark blue - AA Red - B BBB Grey - not rated
A credit rating evaluates the credit worthiness of a debtor, especially a business (company) or a government. It is an evaluation made by a credit rating agency of the debtor's ability to pay back the debt and the likelihood of default.[3]
Credit ratings are determined by credit ratings agencies. The credit rating represents the credit rating agency's evaluation of qualitative and quantitative information for a company or government; including non-public information obtained by the credit rating agencies analysts.
Credit ratings are not based on mathematical formulas. Instead, credit rating agencies use their judgment and experience in determining what public and private information should be considered in giving a rating to a particular company or government. The credit rating is used by individuals and entities that purchase the bonds issued by companies and governments to determine the likelihood that the government will pay its bond obligations.
A poor credit rating indicates a credit rating agency's opinion that the company or government has a high risk of defaulting, based on the agency's analysis of the entity's history and analysis of long term economic prospects.
Contents
1 Sovereign credit ratings 2 Short-term rating 3 Corporate credit ratings 4 Credit rating agencies 5 See also 6 References 7 External links
Sovereign credit ratings
Further information: List of countries by credit rating
A sovereign credit rating is the credit rating of a sovereign entity, i.e., a national government. The sovereign credit rating indicates the risk level of the investing environment of a country and is used by investors looking to invest abroad. It takes political risk into account
The table shows the ten least-risky countries for investment as of June 2011. Ratings are further broken down into components including political risk, economic risk. Euromoney's bi-annual country risk index[4] monitors the political and economic stability of 185 sovereign countries. Results focus foremost on economics, specifically sovereign default risk and/or payment default risk for exporters (a.k.a. "trade credit" risk).
A. M. Best defines "country risk"[5] as the risk that country-specific factors could adversely affect an insurer's ability to meet its financial obligations. Short-term rating
A short-term rating is a probability factor of an individual going into default within a year. This is in contrast to long-term rating which is evaluated over a long timeframe. In the past institutional investors preferred to consider long-term ratings. Nowadays, short-term ratings are commonly used.[citation needed]
First, the Basel II agreement requires banks to report their one-year probability if they applied internal-ratings-based approach for capital requirements. Second, many institutional investors can easily manage their credit/bond portfolios with derivatives on monthly or quarterly basis. Therefore, some rating agencies simply report short-term ratings.
Source: Euromoney Country risk June 2011 Country risk rankings (June 2011)[6][7] Least risky countries, Score out of 100 Previous Country Overall score Rank
1 1 Norway 92.44
2 6 Luxembourg 90.86
3 2 Switzerland 90.20
4 4 Denmark 89.07
5 3 Sweden 88.72
6 12 Singapore 87.65
7 5 Finland 87.31 8 7 Canada 87.24
9 6 Netherlands 86.97
10 13 Germany 85.73
Corporate credit ratings
Main article: Bond credit rating
The credit rating of a corporation is a financial indicator to potential investors of debt securities such as bonds. Credit rating is usually of a financial instrument such as a bond, rather than the whole corporation. These are assigned by credit rating agencies such as A. M. Best, Dun & Bradstreet, Standard & Poor's, Moody's or Fitch Ratings and have letter designations such as A, B, C. The Standard & Poor's rating scale is as follows, from excellent to poor: AAA, AA+, AA, AA-, A+, A, A-, BBB+, BBB, BBB-, BB+, BB, BB-, B+, B, B-, CCC+, CCC, CCC-, CC, C, D. Anything lower than a BBB- rating is considered a speculative or junk bond.[8] The Moody's rating system is similar in concept but the naming is a little different. It is as follows, from excellent to poor: Aaa, Aa1, Aa2, Aa3, A1, A2, A3, Baa1, Baa2, Baa3, Ba1, Ba2, Ba3, B1, B2, B3, Caa1, Caa2, Caa3, Ca, C.
A. M. Best rates from excellent to poor in the following manner: A++, A+, A, A-, B++, B+, B, B-, C++, C+, C, C-, D, E, F, and S. The CTRISKS rating system is as follows: CT3A, CT2A, CT1A, CT3B, CT2B, CT1B, CT3C, CT2C and CT1C. All these CTRISKS grades are mapped to one-year probability of default.
Moody's S&P Fitch Long-term Short-term Long-term Short-term Long-term Short-term Aaa AAA AAA Prime Aa1 AA+ AA+ A-1+ F1+ Aa2 AA AA High grade P-1 Aa3 AA- AA- A1 A+ A+ A-1 F1 A2 A A Upper medium grade A3 A- A- P-2 A-2 F2 Baa1 BBB+ BBB+ Baa2 BBB BBB Lower medium grade P-3 A-3 F3 Baa3 BBB- BBB- Ba1 BB+ BB+ Non-investment grade Ba2 BB BB speculative Ba3 Not prime BB- B BB- B B1 B+ B+ Highly speculative B2 B B B3 B- B- Caa1 CCC+ Substantial risks Caa2 CCC Extremely speculative Caa3 CCC- C CCC C In default with little CC Ca prospect for recovery C C DDD / D / DD / In default / D
Credit rating agencies
Main article: Credit rating agency
The largest credit rating agencies (which tend to operate worldwide) are Dun & Bradstreet, Moody's, Standard & Poor's and Fitch Ratings.[9]
Other agencies include A. M. Best (U.S.), Baycorp Advantage (Australia), Egan-Jones Rating Company (U.S.), Global Credit Ratings Co. (South Africa), Japan Credit Rating Agency, Ltd. (Japan). [10], Muros Ratings[11] (Russia alternative rating agency), Rapid Ratings International (U.S.). and Credit Rating Information and Services Limited[12][13](Bangladesh)