Bloomberg News

Uruguay Sovereign Debt Outlook Raised to Positive by Moody’s

January 26, 2012

(Adds bond prices in fourth paragraph.)

Jan. 26 (Bloomberg) -- Uruguay’s credit-rating outlook was raised to positive by Moody’s Investors Service, which cited the government’s commitment to keeping its budget deficit in check.

Moody’s raised the South American country’s outlook from stable today, 13 months after lifting the rating to Ba1, or one level below investment grade.

“A steady improvement in Uruguay’s sovereign credit profile as a result of a strong and continued commitment by the government to fiscal discipline, a condition that has led to moderate deficits and declining debt metrics,” wrote Mauro Leos, a Latin America sovereign credit analyst for Moody’s Investors Service, in a report.

Yields on government dollar bonds due in 2022 fell 4 basis points, or 0.04 percentage point, to 3.94 percent as of 2:53 p.m. New York time, and the extra yield investors demand to hold Uruguayan bonds instead of U.S. Treasuries rose 3 basis points to 210. That’s less than some investment-grade countries including Peru, Russia, and Poland.

The Uruguayan government reduced its debt by extending average maturities and decreasing the share of foreign currency- denominated debt, according to the report.

Moody’s lowered Uruguay’s rating to Ba2, two levels below investment grade, in 2002 as neighboring Argentina struggled in the aftermath of its record default.

--Editor: Glenn J. Kalinoski

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To contact the reporter on this story: Camila Russo in Buenos Aires at

To contact the editor responsible for this story: Adam Cataldo at

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