Fitch upgrades ratings for Brazil’s Gerdau, outlook remains stable

Thursday, 09 June 2022 16:14:45 (GMT+3)   |   Istanbul
       

International credit rating agency Fitch Ratings has announced that it has upgraded the ratings of Brazilian integrated steelmaker Gerdau from BBB- to BBB, while noting that the company’s outlook remains stable.

Fitch said the upgraded ratings reflect the company’s debt reduction, while the investment grade ratings reflect the company’s consistent commitment to a sound capital structure, its extended debt-amortization profile, its robust liquidity position, geographic operational diversification, and its flexible operational structure of electric arc furnace steel production, which allows it to swiftly respond to changing market conditions.

The agency also noted that steel prices started to fall in Brazil from the August 2021 peak and continued to decrease in 2022 amid political risks, inflationary pressures, a tighter monetary policy and a growth slowdown. Fitch assumes that Brazil’s domestic steel output will decrease by 13 percent in 2022, and stabilize in 2023 and in 2024.


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