FXStreet (Delhi) – Research Team at BBH, note that the rating agenchy Fitch has downgraded Brazil one notch to BBB- and kept a negative outlook. Key Quotes “This really shouldn't come as a big surprise, as the BBB rating it had was too high. Our own sovereign rating model now has Brazil at BB-/Ba3/BB- so downgrade risk remains very strong.” “S&P has it at BB+, while Moody's has it at Baa3 with an inexplicable stable outlook. Markets might show some relief that Fitch didn't cut by two notches to BB+, but we think another cut is in the cards to BB+.” “ Many funds and indexes require a country to have an investment grade rating from 2 out of 3 rating agencies in order to be investible. S&P is already at sub-investment grade.” “Frankly, we think all 3 will eventually get there but Fitch's negative outlook suggests it will move before Moody's does given its stable outlook. The timing is anyone's guess, but we think it will eventually happen.” For more information, read our latest forex news.