In these uncertain economic times credit rating agencies have become a hot topic.
If we look at some recent events:
- The downgrade of some European countries like Greece, Ireland, Portugal,...
The Eurozone crisis : aid packages for indebted euro zone countries - The controversial first ever downgrade of the AAA rating of the USA by S&P
It seems that any mention of a possible rating/outlook change causes panic on the markets and in the affected countries.
There are 3 big agencies that grade the risk level of the investing environment of a sovereign entity (national governments) :
- Moody’s about 40% market share
- Standard & Poor’s about 40% market share
- Fitch about 14% market share
This mashapp gives an overview of the ratings of the big three
See the differences between rating agencies
example USA AAA for Mood's and Fitch , AA+ for S&P
Link : Sovereign Credit ratings Mashapp
