Lebanon’s Debt Downgraded Again by Moody’s Amid Bond Meltdown - Bloomberg:
Lebanon’s credit rating was cut one level further into junk territory by Moody’s Investors Service on Tuesday as protests roil the nation, reflecting the increased likelihood of debt rescheduling or other steps that may constitute a default.
Moody’s analyst Elisa Parisi-Capone said the viability of the currency’s peg to the U.S. dollar and macroeconomic stability are both threatened by mass protests and a loss of investor confidence. Moody’s downgraded Lebanon’s long-term foreign debt to Caa2 and said the rating remains on watch negative, meaning more cuts may be in store.
Lebanese debt has lost investors 18% so far this year, a collapse exceeded only by Venezuela and Argentina. Bonds maturing in 2027 extended the day’s drop to 4.8% after the decision, the worst performance among emerging-market sovereign bonds.
Lebanon’s credit rating was cut one level further into junk territory by Moody’s Investors Service on Tuesday as protests roil the nation, reflecting the increased likelihood of debt rescheduling or other steps that may constitute a default.
Moody’s analyst Elisa Parisi-Capone said the viability of the currency’s peg to the U.S. dollar and macroeconomic stability are both threatened by mass protests and a loss of investor confidence. Moody’s downgraded Lebanon’s long-term foreign debt to Caa2 and said the rating remains on watch negative, meaning more cuts may be in store.
Lebanese debt has lost investors 18% so far this year, a collapse exceeded only by Venezuela and Argentina. Bonds maturing in 2027 extended the day’s drop to 4.8% after the decision, the worst performance among emerging-market sovereign bonds.
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