Latin America Can Deal Better With Financial Shocks

One of the biggest lessons of the global financial and economic crisis has been the improvement in Latin America's ability to cope with external shocks, said Gabriel Torres, senior analyst at Moody's Investors Service, on Thursday. The region as a whole is exiting the crisis without any "serious impact" on its debt numbers, Torres said at a conference held by Moody's in Buenos Aires. Countries such as Brazil and Chile have seen their sovereign ratings upgraded during the crisis, and the positive outlook means further upgrades could be forthcoming in the near future, Torres said. There have been questions recently about Mexico, which has suffered largely due to its close relationship with the U.S. Concerns about the newly passed budget have prompted analysts to suggest that a downgrade on the country's sovereign rating seems likely and that the government's evasive position on the economy's structural issues gives plenty of reasons for the peso to fall. Torres said Moody's has "never considered" cutting the country's rating below investment-grade. At most, Moody's could put the outlook for the country's rating on negative and maybe downgrade it by one notch but even that was recently ruled out, he said. In August, Moody's affirmed Mexico's Baa1 rating with no changes to the outlook, he said. Michel Madelain, Moody's chief operating officer, said that in the third quarter of the year there were more positive ratings actions across the region than negative ones. READ FULL STORY
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