Thursday’s political risk datapoint:
DIFC – Dubai, May 26, 2011 – Moody’s Investors Service has today downgraded Bahrain’s government bond ratings by one notch to Baa1 from A3, and assigned a negative outlook to the rating. Today’s rating action concludes the review for possible downgrade that Moody’s initiated on 23 February 2011…
The main driver underlying Moody’s decision to downgrade is the significant deterioration in Bahrain’s political environment since February. The government of Bahrain has forcibly suppressed an uprising by the Shi’ah-led opposition with the backing of an intervention of armed forces from other member states of the Gulf Cooperation Council (GCC), most importantly from its neighbour Saudi Arabia. Political tensions in the country remain high and there seems little prospect of the underlying causes of the unrest being peaceably resolved, at least over the short term. The political outlook is therefore highly uncertain.
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