rating agencies

So The Bank Of England And The UK Government Cannot Default On Its Bonds – Is It?

27 February 2013

Always start macroeconomics with balance of payments :-) Recently, Moody’s Investors Service has today downgraded the domestic- and foreign-currency government bond ratings of the United Kingdom by one notch to Aa1 from Aaa. It also downgraded the Bank of England: In a related rating action, Moody’s has today also downgraded the ratings of the Bank […]


The Monetary Economics Of Sovereign Government Rating

4 May 2012

If a government (outside monetary unions) can make a draft at the central bank, why do rating agencies rate governments’ creditworthiness? In this post, I will attempt to describe the dynamics of defaults and restructurings by going through some monetary economics of open economies. Carmen Reinhart and Kenneth Rogoff wrote a book in 2009 titled This […]


S&P’s FAQs On EA Rating Actions

14 January 2012

S&P released another document yesterday in connection with the rating action of Eurozone governments yesterday which you can get via it’s Tweet: FAQ on factors behind S&P’s rating actions on Eurozone governments: ow.ly/d/sQc — Standard & Poor’s (@standardpoors) January 13, 2012 On the political agreements, the release says: We also believe that the agreement is […]


S&P Takes Rating Actions On Euro Area Governments

13 January 2012

On 5 December 2011, S&P put ratings of EA17 governments on rating watch negative. See my post S&P And EA17 National Governments for link to the S&P report. Today it concluded its review and downgraded several governments. S&P takes rating actions on 16 Eurozone sovereign governments. Report here: http://t.co/zOXxihQ9 — Standard & Poor's (@standardpoors) January 13, […]


S&P Again

6 December 2011

Yesterday S&P put 15 of the EA17 governments on CreditWatch negative (comments and links here). It later came out with Credit FAQ: Factors Behind Our Placement Of Eurozone Governments On CreditWatch which gives the rationale for the action. According to the S&P For countries in net external liability positions, including the eurozone’s peripheral economies, we see growing […]


S&P And EA17 National Governments

5 December 2011

First, there was a leak from FT S&P ratings warning to top euro nations and then it really happened: Pdf uploaded by S&P here Does it matter? Yes and No. Will have to wait for the markets to open tomorrow, although SPX and EURUSD moved a bit after FT put out the news. The Euro Area […]


Hungary Again

11 November 2011

I had two previous posts on Hungary here and here. Initially I thought of writing more on this, but today Fitch came out with a rating action and I guess explains most stuff on the deterioration of the economy – so enough of Hungary for now. Find below Fitch’s release. I quoted two comments highlighting […]