Fitch Upgrades Korea's Rating Outlook

Discussion in 'Economy' started by bluesky79, Nov 9, 2011.

  1. bluesky79
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    bluesky79 Member

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    Credit rating agency Fitch has raised Korea's credit outlook from "A+ stable" to "A+ positive" on Monday. Although Fitch did not raise the country’s credit rating itself, the outlook signals the potential of Korea being upgraded to "AA-" or even the double-A level in the next six months to a year.

    The last time Fitch upgraded Korea's credit rating outlook was in August 2009.

    Korea received an "AA-" credit rating back in 1996 but was downgraded during the 1997 Asian financial crisis and has not been able to claw back. Currently China, Italy, Korea and Taiwan are rated "A+." Saudi Arabia and Spain are rated "AA-," and Japan "AA."

    Fitch in a press release said it raised the outlook because “rising foreign reserves and decreasing reliance on short-term external debt are strengthening Korea’s external liquidity." It added currency swap agreements with Japan and China have quelled concerns over foreign currency liquidity.

    Fitch, however, predicted that Korea's external maturities which "will pick up strongly in 2012 to about US$66 billion, against an average of $22 billion annually over 2007-2011." "Refinancing these maturities without putting pressure on the external finances and foreign reserves would strengthen the case for an upgrade," it pointed out.

    Deputy Finance Minister Choi Jong-ku said, "We are optimistic about a credit rating upgrade, since we are able to weather such situations."
     
  2. editec
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    editec Mr. Forgot-it-All

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    There's demonstations against the TRADE AGREEMENT with the USA going on in SK right now.

    Sooner or later the working classes world-wide are going to understand that FREE TRADE as currently practiced usually isn't to their benefit.

    In this case I think SK's farmers are going to take it on the neck, while in the USA it will be out factory workers who get screwed.
     
  3. Mad Scientist
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    Mad Scientist Deplorable Gold Supporting Member Supporting Member

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    Well to be fair, there are demonstrations in Korea on a weekly basis! :lol:

    I agree with the rest of your post though.
     

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