Moody’s Lowers Outlook on US Debt to Negative, Towards Fitch and S&P Global Downgrades

Rating agency Moody’s lowered its outlook on the US credit rating to “negative” from “stable”, pointing to a sharp rise in debt servicing costs with higher interest rates and “entrenched political polarization”. The move came after US markets had closed for the weekend. The move followed Fitch and S&P downgraded the US. The credit ratings agency maintained the USA’s top Aaa rating but changed its outlook to ‘negative’. Moody’s is the only of the three big credit rating agencies that … Continue reading “Moody’s Lowers Outlook on US Debt to Negative, Towards Fitch and S&P Global Downgrades”

Fitch Downgrades United States Long-Term Ratings to ‘AA+’ from ‘AAA’, Outlook Stable

Rating agency Fitch downgraded the United States of America’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘AA+’ from ‘AAA’ on Tuesday. The Rating Watch Negative was removed, and a Stable Outlook assigned. The Country Ceiling has been affirmed at ‘AAA’. Fitch had warned debt limit games, political brinksmanship and reduced financing flexibility would impacts United States of America at ‘AAA’. Key Rating Drivers Ratings Downgrade: The rating downgrade of the United States reflects the expected fiscal deterioration over the next … Continue reading “Fitch Downgrades United States Long-Term Ratings to ‘AA+’ from ‘AAA’, Outlook Stable”

American Household Wealth Rises by $3.0 Trillion, $2.4 Trillion from Stocks in Q1 2023

Americans’ household wealth rose by $3.0 Trillion in the first quarter of 2023, it rose to $148.8 trillion. Stock prices have been rebounding after they fell sharply off record highs two years ago after the Federal Reserve began talking of QT and raising rates to combat inflation. Global economy slackness from the Russian invasion of Ukraine and Chinese Covid lockdowns also impacted asset prices negatively. Household debt rose 2.2 percent at an annual rate in the first quarter of 2023. … Continue reading “American Household Wealth Rises by $3.0 Trillion, $2.4 Trillion from Stocks in Q1 2023”

US Debt Ceiling Deal Done, What is In and Out, the Next Steps

U.S. President Joe Biden and Speaker Kevin McCarthy have struck a tentative deal on Saturday to raise the US debt ceiling in an ‘agreement in principle’. If approved, it averts a looming default that will bring relief to nervous markets and bring a sense of relief to the global economy. This was the 79th time it’s been raised since 1960. The US has defaulted four times, the last 1971 when the U.S. left the Bretton Woods convention. Next step is … Continue reading “US Debt Ceiling Deal Done, What is In and Out, the Next Steps”

Mountain Valley Gas Pipeline Permit Approved to Build in Appalachian National Forest

The Mountain Valley natural gas pipeline was approved late Monday to cover 3.5 miles of Jefferson National Forest, which is located between West Virginia and Virginia. The pipeline is expected to carry gas approximately 303 miles from Marcellus shale fields in West Virginia to Virginia. The pipeline has been controversial and long delayed. The U.S. Forest Service reissued its approval for a permit, despite past federal appeals court rulings determining developers had “inadequately considered” the project’s environmental impact. The project, … Continue reading “Mountain Valley Gas Pipeline Permit Approved to Build in Appalachian National Forest”

Federal Reserve Financial Stability Report, Follows Three of the Four Largest Failures in U.S. History

The Federal Reserve released its twice–yearly report Monday on financial hazards in its 2023 financial stability report. The report comes after a busy week for the Fed, following the second largest bank failure in U.S. history with First Republic, now three of the top four largest failures over just the past two months. The Fed said recent turmoil in the banking industry has stabilized but could weigh on credit conditions going forward. The Fed said it is prepared to address … Continue reading “Federal Reserve Financial Stability Report, Follows Three of the Four Largest Failures in U.S. History”

US Sovereign Rating Affirmed AA+ With Stable Outlook Stable By S&P

Standard and Poors rating agency affirmed that the US sovereign ratings remain ‘AA+/A-1+’ and the outlook remains stable. The affirmation comes out in the midst of a banking crisis with the US having three bank failures in a week. SVB was the largest failure since Washington Mutual’s September 2008 collapse and the second largest in U.S. history. The S&P says sovereign stability is based on strong American institutions, a diversified and resilient economy, extensive monetary policy flexibility. The agency added … Continue reading “US Sovereign Rating Affirmed AA+ With Stable Outlook Stable By S&P”

Brazil and Argentina Plan for a Latin American Common Currency

Two of Latin America’s largest economies Brazil and Argentina with eyes to strength in numbers along the lines of the Euro, plan a common currency to reduce the risk that comes with relying on the US dollar. Both countries have been in a cycle of a financial roller coaster since the Latam financial crisis of the 1970’s. Market crashed continue to pop up in recent years. The hope is it would strengthen trade amongst the group. It would at first … Continue reading “Brazil and Argentina Plan for a Latin American Common Currency”

Brazil Oil Major Petrobras Shares Fall 10% After Plans to Privatize Shelved by New President Lula

Petrobras shares fell -10.75% Tuesday to $9.51-1.14 after the Brazilain oil major was no longer going to be privatized. Luiz Inacio Lula da Silva in one of his first official acts after being sworn in as Brazil’s president on January 1 was to remove Petrobras (PBR) and Brazil’s postal service from the list of state asset sales from a list of state-controlled businesses that had been scheduled for privatization. Lula plans on turning PBR it into a renewable energy powerhouse. … Continue reading “Brazil Oil Major Petrobras Shares Fall 10% After Plans to Privatize Shelved by New President Lula”

Brazilian Real Best Year Since 2016 with Interest Rates at 13.75%

The Brazilian Real at $5.3 closed up more than 6% in 2022 supported by a series of interest rate hikes by the central bank and an upbeat growth outlook. Banco Central do Brasil​ aggressively hiked its benchmark interest rate to 13.75% in twelve consecutive interest rate hikes since 2021 when the bank began its current tightening cycle early last year, the Selic was at a record low 2%. The lending rate is now at its highest level since 2017. The … Continue reading “Brazilian Real Best Year Since 2016 with Interest Rates at 13.75%”