Moody's downgrades Tunisia's credit rating

Jan 20, 2011

Moody's downgraded ratings of the Tunisian government on Wednesday (January 19th), following weeks of political troubles and an unexpected regime change.

The nation went from Baa2 to Baa3, standing in the league of countries with "moderate credit risk" that are considered medium-grade where "protective elements may be lacking or may be characteristically unreliable".

The credit rating agency also lowered the country's short-term ratings from P-2 to P-3 and lowered deposit ratings.

Moody's explained that "the current uncertainties about the economic and political consequences of the collapse of Tunisia's previous political regime are the main drivers for the decision to downgrade the government's bond ratings".

However, it added that the country's capacity to bounce back must not be under-estimated.

Standards and Poor's credit rating agency is also considering downgrading Tunisia's. It recently revealed that a decision will be taken within the next three months.