International credit rating agency Moody's has announced that it has downgraded the global steel giant
ArcelorMittal's credit rating from ‘Baa3' to ‘Ba1', which is considered as ‘junk status', confirming the outlook as negative.
The rating agency pointed out that the third quarter results of the steelmaker indicate the worst quarterly performance since the second quarter of 2009. The downgrade also reflects the deterioration in global steel markets over the last six months.
Moody's expects the challenging conditions for
ArcelorMittal to continue over several quarters "with its operating environment more likely to get worse before it gets better."
According to Moody's,
ArcelorMittal will maintain its negative outlook unless the global economy and steel markets improve and unless the company carries out more of its asset disposals and other credit enhancing actions.
As SteelOrbis previously reported, in August rating agency Standard and Poor's reduced
ArcelorMittal's credit rating to junk status as a result of the further weakening in the sector and
ArcelorMittal's weaker-than-expected second quarter results, and also due to uncertainty in the debt reduction plans of the steelmaker.