investment grade
why its important:
Brazil was awarded investment grade status by Standard & Poor’s, the ratings agency, on April 30, which has added to its appeal among investors, many of whom have strict rules preventing the buying of speculative grade assets because of the dangers of default.
Brazil’s government, with a much bigger public debt, needs to preserve its primary fiscal surplus (ie, before interest payments) to retain the confidence of bondholders. see: Brazil macroeconomic profile
background
Peru achieved "investment grade" status in 2008, but what does that mean? Is Fitch ratings agency saying its "safe to invest in Peru"?. Will Peru be able to remain investment grade?.....
News: "Peru ’s foreign-currency debt rating was raised to investment grade by Fitch Ratings this week, roughly two decades after Peru defaulted on its debt. Surging economic growth fueled by record commodity exports and sound fiscal policies boosted the South American country's capacity to repay its debts. The fact that Peru became investment grade during the ongoing turmoil gives even more hope to Brazil , the other Latin American country on the verge of investment grade. source: “Peru is Investment Grade: Will Brazil Be Next?”
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