Fitch, the ratings agency, has reversed itself on Canada. It now believes that the housing market there is poised for only modest declines at worst. Previously, Fitch had said that Canada’s housing market was well overpriced and that a major correction was a serious risk. I believe the combination of high prices and high household debt means the risk of a major correction is still there.
Tag: ratings agencies
India: rupee in freefall, stagflation setting in, risks of sovereign downgrade and investor panic rising
This is beginning to sound like a broken record, but India’s currency has come under severe pressure – again. India’s central bank, the RBI, seems to have completely lost control over the rupee. The currency broke through 67 to the dollar this morning – a level that was difficult to fathom just a few months ago.
Moody’s has changed its outlook on the U.S. banking system to stable from negative, reflecting continued improvement in the operating environment and reduced downside risks to the banks from a faltering economy, says Moody’s Investors Service in its latest “Banking System Outlook: United States of America.” The outlook had been negative since 2008.
Editors note: Moody’s released the following press release yesterday in conjunction with a ratings action it took on Turkish sovereign debt. Moody’s Investors Service has today upgraded Turkey’s government bond ratings by one notch to Baa3 from Ba1, and has assigned a stable outlook. The key drivers for today’s rating […]
Moody’s Investors Service released the following statement in conjunction with a ratings action it took today on Slovenian sovereign debt.
Moody’s Investors Service has today affirmed the Republic of Ireland’s Ba1/Not Prime government bond ratings and negative outlook.
Full Text: Moody’s Downgrades Argentina’s Foreign Law Bonds to Caa1, Affirms B3 Issuer Rating, Outlook Negative
Moody’s issued the following press release yesterday in relation to Argentina’s foreign-law sovereign obligations.
Moody’s released the following statement in conjunction with a ratings action it took earlier today on three Dutch banks
For domestic investors, the safe haven asset class are government liabilities if the government has substantially all liabilities in the currency it creates. For foreign investors, like domestic investors, you want to protect against default risk by investing in a currency area’s risk-free asset class but you also want to mitigate currency risk. That’s what safe haven risk is all about. The other stuff is irrelevant.
So what is a safe haven you might ask? Well I certainly don’t have the final answer, but I would suppose it should as many as the following characteristics as possible.
Here are 10 items that investors will be watching this week.
Moody’s took away the UK’s triple A rating late Friday. A ratings downgrade has long been rumored, and although the timing is always surprising, the move itself has long been anticipated. Sterling slumped on the news in thin dealings, losing a cent in about 30 minutes. When it comes to corporate ratings we can appreciate that rating agencies may have access to private information. They may also be of value in some developing countries, where information is more difficult to secure. However, when it comes to large developed countries, the rating agencies have access only to public information and it is the same information that investors use to make their decisions.