The Moody’s rating agency has downgraded the credit ratings of Mexico and the Mexican state-owned oil company Pemex, with Pemex rating downgraded to “trash” level.
Moody’s was the second major rating agency after Fitch to downgrade Pemex to garbage. This could trigger a sale of the securities issued by the company.
In 2019, Mexico’s economy entered a moderate recession. Many analysts predict that the country’s GDP this year will decline to 10% due to the crisis caused by the pandemic.
Mexican President Andrés López Obrador has bet on the revival of the state Pemex. However, rating agencies have long criticized these plans, which imply the construction of an expensive refinery and limited participation of private companies in the energy sector.