Brazil’s government debt is rising “sharply” and is on the high side of the median for BBB-rated sovereign securities, said Shelly Shetty, Fitch Ratings senior director and head of Latin America sovereign debt.
Ford Motor Co. is marketing bonds backed by auto loans at half the relative yield it paid six months ago and Nordstrom Inc. sold notes at its lowest rate ever as investors gain confidence that consumer spending is strengthening.
A five-week rally in the Brazilian real is limiting President Luiz Inacio Lula da Silva’s efforts to make the country’s exports more competitive in international markets. Lula himself is partly to blame, according to Harvard University Professor Ricardo Hausmann .
Mexico had its credit rating raised by Fitch Ratings on the prospect that proposed legal changes will boost growth in Latin America’s second-largest economy. The peso surged to the strongest level since August 2011.
Latin America may see the pace of credit rating increases slow as governments in the region refrain from implementing reforms aimed at broadening their tax base and increasing competition, Fitch Ratings said.
The risk associated with holding Brazilian bonds relative to Peru climbed to a 20-month high on concern President Luiz Inacio Lula da Silva isn’t taking advantage of the fastest growth in two decades to cut debt .