Moody’s ratings change That perspective from Mexico from stable to negative and confirmed the sovereign note in “Baa2”.
The agency said the change in outlook was due to its view of “weakening institutional and policy frameworks that could undermine financial and economic performance.”
He noted that recent reform of the judicial system in Mexico, under which judges, magistrates and court ministers will be elected by popular vote, could weaken the checks and balances of the judicial system, which could have negative consequences for the economy and finances. the strength of the country.
Moody He added that there was a strong possibility that state oil company Pemex’s contingent liabilities would materialize on the government’s balance sheet and would not restore the sustainability of the company’s long-term debt at the same time, creating risks for government prosecutors.
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Outlook downgrade based on concerns about possible institutional weakness: SHCP
The Ministry of Finance said that this adjustment does not imply a downgrade of the rating, but rather is a response to a precautionary analysis of the expected balance of risks.
The change in outlook, SHCP said, is due to the agency’s perceived tightness on government spending and fiscal consolidation challenges, as well as the possibility of institutional changes that could impact the business climate.
“It is important to note that at the time of the Council’s drafting, the agency did not have information on the 2025 budget, proposed fiscal policy for next year, or the forecasts that the Ministry of Finance will present tomorrow to the Union Congress.
“This situation suggests that Moody’s analysis and perspective could benefit from a more detailed and updated assessment,” the Treasury said.
He also indicated that Moody’s recognizes the arrival of new investments in the country, motivated by the relocation of companies due to trade tensions between the United States and China.
“These investments offer significant potential for economic growth and reflect Mexico’s strategic position on the global trading stage.”
He noted that Mexican government debt remains attractive in international markets, demonstrating resilience in the face of economic fluctuations and financial instability.
In addition, he said, Mexico has the necessary fiscal buffers to mitigate possible adverse scenarios in the global environment, reaffirming the Treasury Department’s commitment to sound management that strengthens the sustainability of public finances and debt sustainability.
Source: Aristegui Noticias
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
