reports
- Nichola James
- Thomas R. Torgerson
Resilience of North American Economy Supports U.S. & Canadian Sovereig...
The U.S. credit rating has been in the spotlight in recent months. With Congress delaying passage of a debt ceiling increase until the U.S. Treasury was running very low on cash, we placed our rating of the United States Under Review with Negative implications (URN) on May 25. The passage of the Fiscal Responsibility Act on June 3 enabled the Treasury to increase debt issuance and quickly restore its cash position (from $23 billion on June 2 to $502 billion as of end-July). Just a week ago, we c...
- Nichola James
- Thomas R. Torgerson
Baseline Macroeconomic Scenarios for Rated Sovereigns: June 2023 Updat...
In this commentary we provide an update to DBRS Morningstar’s Baseline Macroeconomic Scenarios. Key highlights include: -- Economic data continues to show resilience amid tighter financial conditions. Forecasts for 2023 continue to improve, while expectations for 2024 are generally worsening as projected slowdowns are pushed further out into the future. -- While a mild advanced economy recession will likely have a limited impact on rated sovereigns, the risk of a deeper downturn in 2024 canno...
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- Michael Heydt
- Thomas R. Torgerson
North America Macroeconomic Update: Resilient Economies Call For Tight...
DBRS Morningstar released its semiannual North America Macroeconomic Update. The U.S. and Canadian economies continue to show remarkable resilience in spite of tighter monetary policy. Households are spending at a robust pace, supported by healthy balance sheets and tight labor markets. The inflation outlook is clearly improving, but returning to the two percent target could still be challenging. The Federal Reserve and the Bank of Canada are responding to resilient economies with higher rates f...
- Nichola James
- Thomas R. Torgerson
Baseline Macroeconomic Scenarios for Rated Sovereigns: April 2023 Upda...
This commentary provides an update to DBRS Morningstar's Baseline Macroeconomic Scenarios. These baseline scenarios provide our estimate of the current market consensus, and are drawn from a simple median calculation across various external contributor forecasts. In this update, we discuss the deteriorating outlook for 2024. To date, we note that the March 2023 bank failures have had only a modest impact on forecasts. We continue to see considerable downside risks to the baseline. Key Highligh...
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1271Z FEDERAL REPUBLIC OF
GERMANY DENMARK
DENMARK KINGDOM OF
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1092Z GOVERNMENT OF
Lithuania UNITED STATES OF AMERICA
3344606Z UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND
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ESTONIA REPUBLIC OF
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CHINA REPUBLIC OF
1426Z ESTONIA
Belgium REPUBLIC OF
111136Z CHINA
1023Z PEOPLE'S REPUBLIC OF
Slovak UNITED MEXICAN STATES
1153Z BELGIUM
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1480Z REPUBLIC OF
Austria ARGENTINA
1233Z REPUBLIC OF
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1841Z REPUBLIC OF
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CYPRUS KINGDOM OF
EUROPE SPAIN
1004Z KINGDOM OF
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1266Z REPUBLIC OF
IRELAND HELLENIC REPUBLIC
1179Z LUXEMBOURG
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- Thomas R. Torgerson
- Travis Shaw
Canada's 2023 Federal Budget: Fiscal Outlook Largely Intact
The Government of Canada tabled its FY22-23 budget on March 28. The federal government continues to move forward with increased spending in priority areas and provide targeted inflation relief. We view the outlook for public finances as largely unchanged. Although the budget is no longer expected to balance within the forecast horizon, deficits will trend gradually lower, and debt-to-GDP will resume a downward trend after experiencing a modest increase in FY23-24. “While the economy continues t...
- Thomas R. Torgerson
- Travis Shaw
- Travis Shaw
- Thomas R. Torgerson
- Travis Shaw
DBRS Morningstar Confirms Government of Canada at AAA Stable
DBRS Limited (DBRS Morningstar) confirmed the Government of Canada’s Long-Term Foreign and Local Currency – Issuer Ratings at AAA. At the same time, DBRS Morningstar confirmed the Government of Canada’s Short-Term Foreign and Local Currency – Issuer Ratings at R-1 (high). The trend on all ratings is Stable.
- Carlo Capuano
- Javier Rouillet
- Thomas R. Torgerson
Prolonged Monetary Policy Tightening Could Exacerbate the Decline in H...
A more aggressive and prolonged monetary policy tightening in Canada, the United Kingdom, and the United States during 2023 and 2024 would likely have a negative impact on housing prices and on economic growth. Current market expectations are for these respective countries' central banks to significantly slow or pause their rate hike cycles in coming months. If this assumption proves incorrect and interest rates continue to move higher, this could weigh not only on investment but also on consume...
- Nichola James
- Thomas R. Torgerson
Baseline Macroeconomic Scenarios for Rated Sovereigns: December 2022 U...
This commentary provides an update to DBRS Morningstar’s Baseline Macroeconomic Scenarios. These baseline scenarios provide our estimate of the current market consensus, and are drawn from a simple median calculation across various external contributor forecasts. In this update, we discuss the ongoing monetary tightening and bleak outlook for 2023. Key highlights include: -- Forecasts for 2023 have deteriorated in recent months. Growth will be very weak or negative for most major economies. -- ...
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DENMARK KINGDOM OF
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1092Z GOVERNMENT OF
Lithuania UNITED STATES OF AMERICA
3344606Z UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND
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Belgium REPUBLIC OF
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EUROPE SPAIN
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CN REPUBLIC OF
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Japan REPUBLIC OF
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Portugal REPUBLIC OF
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- Michael Heydt
- Thomas R. Torgerson
North America Macroeconomic Update: Slowing Growth, Slowing Inflation
DBRS Morningstar released its semiannual North America Macroeconomic Update. While third quarter headline GDP growth figures suggest that the U.S. and Canada continued to grow at a strong pace, the composition of growth reveals that both economies are slowing amid rapidly rising interest rates. Headline inflation has peaked but strong cost pressure for services could slow the pace of disinflation, particularly as labor markets remain exceptionally tight. Against this backdrop, the monetary tight...
- Michael Heydt
- Thomas R. Torgerson
Ottawa Shows Restraint Amid Elevated Inflation And A Deteriorating Eco...
Canada’s federal government delivered its Fall Economic Statement yesterday amid a complicated economic outlook. Like many other economies, Canada is facing elevated inflation, rising interest rates, slowing domestic and external growth, and volatile global financial markets. Against this backdrop, the Statement shows that federal fiscal policy aims to act in coordination with the Bank of Canada, or at least not against it, and that public finances are in a stronger position than expected six mo...
- Nichola James
- Thomas R. Torgerson
Baseline Macroeconomic Scenarios for Rated Sovereigns: September 2022 ...
This commentary provides an update to DBRS Morningstar’s Baseline Macroeconomic Scenarios. These baseline scenarios provide our estimate of the current market consensus, and are drawn from a simple median calculation across various external contributor forecasts. In this update, we discuss the ongoing monetary tightening and growing risks of recession. Key Highlights • Baseline forecasts are becoming increasingly bearish, particularly the outlook for 2023. High inflation, energy and labor sho...
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GERMANY DENMARK
DENMARK KINGDOM OF
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1092Z GOVERNMENT OF
Lithuania UNITED STATES OF AMERICA
3344606Z UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND
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ESTONIA REPUBLIC OF
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CHINA REPUBLIC OF
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Belgium REPUBLIC OF
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1023Z PEOPLE'S REPUBLIC OF
Slovak UNITED MEXICAN STATES
1153Z BELGIUM
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ARGENTINA COLOMBIA
1480Z REPUBLIC OF
Austria ARGENTINA
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- Michael Heydt
- Thomas R. Torgerson
- Michael Heydt
- Nichola James
- Thomas R. Torgerson
Baseline Macroeconomic Scenarios For Rated Sovereigns: June 2022 Updat...
This commentary provides an update to DBRS Morningstar’s Baseline Macroeconomic Scenarios. These baseline scenarios provide our estimate of the current market consensus, and are drawn from a simple median calculation across various external contributor forecasts. We also explore some noteworthy risks to the baseline scenarios, and briefly discuss some potential implications for credit ratings. Key highlights include: • 2022 growth projections have deteriorated in recent months, dri...
3413Z GERMANY
1271Z FEDERAL REPUBLIC OF
GERMANY DENMARK
DENMARK KINGDOM OF
80710Z CANADA
1092Z GOVERNMENT OF
Lithuania UNITED STATES OF AMERICA
3344606Z UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND
1000Z LITHUANIA
ESTONIA REPUBLIC OF
PRCH LATVIA
CHINA REPUBLIC OF
1426Z ESTONIA
Belgium REPUBLIC OF
111136Z CHINA
1023Z PEOPLE'S REPUBLIC OF
Slovak UNITED MEXICAN STATES
1153Z BELGIUM
COLOMBIA KINGDOM OF
93187Z SLOVAK REPUBLIC
ARGENTINA COLOMBIA
1480Z REPUBLIC OF
Austria ARGENTINA
1233Z REPUBLIC OF
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1841Z REPUBLIC OF
3343903 NORWAY
CYPRUS KINGDOM OF
EUROPE SPAIN
1004Z KINGDOM OF
1110Z CYPRUS
1266Z REPUBLIC OF
IRELAND HELLENIC REPUBLIC
1179Z LUXEMBOURG
SWEDEN GRAND DUCHY OF
1306Z IRELAND
CN REPUBLIC OF
2103Z SWEDEN
172369Z KINGDOM OF
LATAM FINLAND
Japan REPUBLIC OF
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SLOVENIA REPUBLIC OF
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5753Z JAPAN
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1533Z SWISS CONFEDERATION
1545Z MALTA
ASIA REPUBLIC OF
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- Michael Heydt
- Thomas R. Torgerson
North America Macroeconomic Update: The Challenge Of Cooling Excess De...
DBRS Morningstar released its semiannual North America Macroeconomic Update. The U.S. and Canada continued to grow at a solid pace in the first quarter of 2022. Both economies now appear to be operating above capacity, with extraordinarily tight labor markets. However, downside risks to the growth outlook have intensified since our December 2021 Update. High inflation is eroding consumers’ purchasing power and prompting more aggressive monetary policy tightening. The latter has led to a repricin...
- Scott Anderson
- Michael Heydt
- Thomas R. Torgerson
Climate Policies Are Not Likely To Impact Canada's Sovereign Credit Ra...
On March 29, the Canadian government published its first Emissions Reduction Plan, which outlines how the country plans to meet its ambitious decarbonization targets. Canada is committed to reducing economy-wide greenhouse gas (GHG) emissions by at least 40% compared to 2005 levels by 2030 and achieve net zero emissions by 2050. However, with emissions in 2019 essentially unchanged from 2005, the goal of rapidly transitioning to a low carbon economy and eventually a net-zero economy presents a m...
- Nichola James
- Thomas R. Torgerson
Baseline Macroeconomic Scenarios for Rated Sovereigns March 2022 Updat...
DBRS Morningstar has released a commentary updating our Baseline Macroeconomic Scenarios for Rated Sovereigns. These baseline scenarios provide our estimate of the current market consensus, and are drawn from a simple median calculation across various external contributor forecasts. We also explore some noteworthy risks to the baseline scenarios, and briefly discuss some potential implications for credit ratings. Key highlights include: • Baseline forecasts have deteriorated in rec...
3413Z GERMANY
1271Z FEDERAL REPUBLIC OF
GERMANY DENMARK
DENMARK KINGDOM OF
80710Z CANADA
1092Z GOVERNMENT OF
Lithuania UNITED STATES OF AMERICA
3344606Z UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND
1000Z LITHUANIA
ESTONIA REPUBLIC OF
PRCH LATVIA
CHINA REPUBLIC OF
1426Z ESTONIA
Belgium REPUBLIC OF
111136Z CHINA
1023Z PEOPLE'S REPUBLIC OF
Slovak UNITED MEXICAN STATES
1153Z BELGIUM
COLOMBIA KINGDOM OF
93187Z SLOVAK REPUBLIC
ARGENTINA COLOMBIA
1480Z REPUBLIC OF
Austria ARGENTINA
1233Z REPUBLIC OF
NORWAY AUSTRIA
1841Z REPUBLIC OF
3343903 NORWAY
CYPRUS KINGDOM OF
EUROPE SPAIN
1004Z KINGDOM OF
1110Z CYPRUS
1266Z REPUBLIC OF
IRELAND HELLENIC REPUBLIC
1179Z LUXEMBOURG
SWEDEN GRAND DUCHY OF
1306Z IRELAND
CN REPUBLIC OF
2103Z SWEDEN
172369Z KINGDOM OF
LATAM FINLAND
Japan REPUBLIC OF
1319293D ITALY
SLOVENIA REPUBLIC OF
1091Z URUGUAY
344758Z ORIENTAL REPUBLIC OF
5753Z JAPAN
223727Z SLOVENIA
1323Z REPUBLIC OF
1533Z SWISS CONFEDERATION
1545Z MALTA
ASIA REPUBLIC OF
1174Z FRANCE
Portugal REPUBLIC OF
1504Z BRAZIL
EM FEDERATIVE REPUBLIC OF
EMKT THE NETHERLANDS
ENEW KINGDOM OF
NI SINGAPORE
TOPEM REPUBLIC OF
TOPL PORTUGAL
REPUBLIC OF
INDIA
REPUBLIC OF
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