Sovereign credit ratings during the COVID-19 pandemic.
Int Rev Financ Anal
; 78: 101879, 2021 Nov.
Article
in English
| MEDLINE | ID: covidwho-2284460
ABSTRACT
Using 603 sovereign rating actions by the three leading global rating agencies between January 2020 and March 2021, this paper shows that the severity of sovereign ratings actions is not directly affected by the intensity of the COVID-19 health crisis (proxied by case and mortality rates) but through a mechanism of its negative economic repercussions such as the economic outlook of a country and governments' response to the health crisis. Contrary to expectations, credit rating agencies pursued mostly a business-as-usual approach and reviewed sovereign ratings when they were due for regulatory purposes rather than in response to the rapid developments of the pandemic. Despite their limited reaction to the ongoing pandemic, sovereign rating news from S&P and Moody's still conveyed price-relevant information to the bond markets.
Full text:
Available
Collection:
International databases
Database:
MEDLINE
Type of study:
Prognostic study
Language:
English
Journal:
Int Rev Financ Anal
Year:
2021
Document Type:
Article
Affiliation country:
J.irfa.2021.101879
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