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Fitch Says Risk of Downgrades Spreading Among Developing Nations

  • Brazil, South Africa top list on slowing growth, Fitch says
  • Saudi Arabia, Gulf nations must cut budgets to preserve rating
Job seekers wait in line at an employment fair in Rio de Janeiro, Brazil.

Job seekers wait in line at an employment fair in Rio de Janeiro, Brazil.

Photographer: Dado Galdieri/Bloomberg
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Brazil and South Africa top a list of emerging-market borrowers whose credit ratings are threatened by slowing growth and ballooning budget deficits, according to Fitch Ratings.

Credit grades across Latin America are also under pressure as the down cycle in commodity prices deepens and stagnation in Brazil’s economy pushes the entire region into contraction, Shelly Shetty, a senior director for sovereigns at Fitch, said in a conference in London Tuesday. In South Africa, the main threats are reduced long-term growth potential and fiscal slippage, said Carmen Altenkirch, a London-based director in Fitch’s sovereign group.