Moody’s cuts Puerto Rico to junk

Moody's on Friday reduce Puerto Rico's credit rating to junk standing, citing concerns concerning the fiscally challenged U.S. territory's vulnerable growth and talent to get admission to capital markets. Moody's, which positioned Puerto Rico's rating on notice for a downgrade late final year, said it now charges the commonwealth's common responsibility bonds at Ba2, two notches below investment grade standing. With some $70 billion of tax-free debt, Puerto Rico has long struggled with recession and has for months been below danger of a ratings downgrade to junk-bond territory by means of all three U.S. credit rankings agencies. Moody's stated Puerto Rico's economic malaise, underfunded pension obligations and excessive deficit "have now put the commonwealth ready the place its debt load and glued prices are high, its liquidity is slender, and its market get admission to has turn into constrained." Moody's additionally reduce its scores on the island's sales-tax supported senior lien COFINA bonds to Baa1 from A2.