LONDON (Reuters) - Governments around the world are likely to face more credit rating cuts as the economic cost of the coronavirus continues to take its toll, S&P Global said on Monday.
S&P has reviewed 90 countries, over two-thirds of those it rates since early March, either downgrading or cutting the outlook in almost half of the cases.
It now has 25 countries on negative outlooks - effectively a downgrade warning - compared to just six on positive outlooks and 104 on stable outlooks.
“We think more negative rating actions are likely,” two of S&P’s senior analysts wrote in a new report, estimating that the average government deficit this year would be around 6.3%.
“Over the medium to long term, we could see negative rating pressure build up, even for some of the ratings we affirmed, if we see the effects of the pandemic becoming structural and likely to have longer-term negative implications that would make recovery of fiscal profiles slower than expected.”
Reporting by Marc Jones; Editing by Chizu Nomiyama