Brazilian Investment Upgraded
Sovereign rating in Brazil has just been upgraded proving Brazil’s status as a safe haven for investment opportunities. For many analysts, the latest upgrades confirm investment in Brazil is a much better bet than in many developed countries.
In the midst of downgrading and financial uncertainty in most advanced economies, it’s refreshing to discover Brazil is doing its fiscal homework. As a result of Brazil’s strong economic policies, Standard & Poor’s (S&P) has just raised Brazil’s ratings in two areas.
Stable Outlook and Rising
Brazil’s long-term sovereign rating has been raised from BBB- to BBB with a stable outlook. According to S&P, the upgrade is a direct result of Brazil’s “demonstrated commitment to meeting fiscal targets”. This commitment was reaffirmed by government figures earlier this month showing a budget surplus of R$14 billion (US$7.4 billion) in October.
S&P also highlights Brazil’s “growing economic resilience” in the current unstable economic climate. The credit rating agency foresees further economic consolidation for Brazil on the back of constant economic growth and careful economic policies. For S&P, Brazil will be able to “moderate the impact of potential external shocks and sustain long-term growth prospects”.
First A Grade
Along with the upgrade on its sovereign rating, Brazil also received its first A grade from a credit rating agency. S&P increased the rating for long-term local currency in Brazil to A-. Described as “one hell of an achievement” by the Financial Times, the upgrade represents a massive vote of confidence for Brazil.
The two upgrades are excellent news for investment in Brazil, currently as its highest levels ever. They also confirm Brazil’s status as a secure investment destination. For the Financial Times, “when it comes to safe places to keep your money, Brazil is gradually proving that it’s now a much better bet than most of the developed world”.
Obelisk International agrees with this assessment since Brazil is now perceived as a safe investment destination by international investors. “Over the last 12 months, we’ve noticed solid confidence in Brazil,” says Obelisk International, “and this is confirmed by the recent increases in Brazilian credit ratings.”
Mr Hardacre points out that Brazil stands ahead of most advanced economies at the moment with its strong and steady economic growth, successful fiscal policies and ratings upgrades. “Few developed nations can say the same at the moment,” Obelisk comments, “and this proves Brazil is the place for investment opportunities now and in the immediate future.”
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