The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Surveys

Country risk March 2005: As spreads tighten the world gets riskier

Country risk index: The latest Euromoney country risk survey reflects a slight downgrade in the assessment of overall risk levels despite sovereign upgrades from rating agencies.

For historical country risk data please visit the Euromoney Country risk website

Methodology

IN A YEAR in which sovereign credit ratings upgrades continued to outpace sovereign downgrades, according to Standard & Poor's, there has also been a further narrowing of spreads in emerging countries' issues or credits. S&P upgraded 28 sovereigns in 2004 and lowered the rating on only seven. This upward trend looks to continue into the first part of 2005.

In our September 2004 survey we reported an aggregate upward shift in the total absolute risk score for all 185 countries rated of 4.5%. This time however, despite sovereign upgrades, there has been a decrease of 3.5% in the overall ratings this half year. This can be attributed to geopolitical instability in the Middle East and Africa.

Underpricing credit fundamentals

According to Francis Nicollas at Crédit Agricole, there has been a "sharp decrease in the price of risk worldwide". He attributes this partly to the "exceptional liquidity of the international financial market, and also the search for spread (because of the low interest rate in the US)".

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree