SAO PAULO, July 14 (Reuters) - Downgrades in Brazilian corporate debt ratings exceeded the number of upgrades by a large margin in the second quarter, Fitch Ratings said on Tuesday, highlighting the size and extent of the nation’s worst economic downturn in 25 years.
For the April-to-June period, corporate downgrades topped upgrades by a ratio of 2.5 to one, the ratings company said in a client note. Brazilian issuers drove 28 percent of downgrades among companies rated by Fitch and 83 percent in Latin America, the note added.
Flagging economic activity in Latin America’s largest economy is expected to continue for the next two years, with Fitch forecasting an economic contraction of about 1.5 percent this year. “This will continue to lead to weak domestic demand across most corporate sectors,” the note said. (Reporting by Guillermo Parra-Bernal; Editing by Diane Craft)