Bleak global prospects won’t affect Moody’s Phl review

MANILA, Philippines - The bleak global economic prospects won’t affect Moody’s Investors Service’s review on the Philippines’ credit rating.

“(U)nderscoring the region’s resilience and stability, the ratings of 18 of the 20 (Asia-Pacific Economic Cooperation) member sovereigns that we rate have stable outlooks, while Peru’s Baa2 carries a positive outlook and Philippines’ Ba1 is under review for upgrade,” Moody’s.

Moody’s in July placed the Philippines’ junk rating on review for upgrade. The debt watcher rates the country a notch below investment grade.

Moody’s said the region, despite gaining stability and strength since the 2008 global financial crisis, faces new challenges in the form of modest recovery among advanced economies, the impending tapering of stimulus of the US Federal Reserve, and a slowdown in China’s growth.

“APEC economies are generally very open and reliant on trade as a key source of corporate profitability and for economy-wide employment and income growth. Therefore, the downturn in global trade and growth post-2008 is having an especially noticeable adverse effect on real GDP growth in the APEC region,” Moody’s said.

Two credit raters, Fitch Ratings and Standard & Poor’s already awarded the Philippines investment grade ratings earlier this year, giving a boost to local markets.

The Philippines in March got its first-ever investment grade rating from Fitch ratings following an upgrade to BBB- from BB+ with a stable outlook. S&P in May granted the country its second investment grade rating as it revised its sovereign rating on the Philippines to BBB- from BB+, also with a stable outlook.