Brazil will be able to maintain its coveted investment-grade rating if its economy improves next year and the government builds a political consensus around crucial austerity measures, a senior analyst with Moody’s Investors Service said on Tuesday.
Mauro Leos said at a Moody’s seminar in Sao Paulo that Brazil’s Baa3 rating, the firm’s lowest investment-grade level, could be lowered to junk if political instability grows further and hampers President Dilma Rousseff’s ability to deliver on her fiscal and growth promises.
Moody’s downgraded Brazil to the brink of junk nearly two months ago with a stable outlook, which suggests the rating is unlikely to change in the short term.
Pressure on Moody’s and competing firm Fitch Ratings to downgrade Brazil has grown, however, after Standard & Poor’s cut the country’s ratings to junk last month.
Brazil Energy Insight 
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