Brazil vowed Thursday to push on with economic reforms after the international credit ratings agency Standard and Poor's downgraded its long-term credit rating because of "slower-than-expected" changes by President Michel Temer's government.
"The government reiterates its commitment" to forge on with measures such as a reform of pensions in an effort "to guarantee the sustainable growth of the Brazilian economy and long-term fiscal balance," the finance ministry said in a statement.
S&P earlier announced it was downgrading Brazil's credit standing further into junk status, at BB- because of its disappointing efforts to "correct structural fiscal slippage and rising debt levels on a timely basis." There was also uncertainty from Brazilian presidential elections later this year, in which Temer was not standing.
The agency kept Brazil's short-term rating at B. S&P said there was "less than one-in-three likelihood" of it changing its long-term rating, either up or down, over the coming year. "This reflects Brazil's comparative external and monetary policy strengths that help offset significant fiscal weakness, an economy with growth prospects lower than peers, and our view that effectiveness of policymaking across branches of government has weakened," it said.
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