S&P document answers questions about public finance ratings outlook in light of COVID-19
S&P Global recently released a FAQ document about the public finance ratings outlook in light of COVID-19. The Credit FAQ: COVID-19, Recession, And U.S. Public Finance Ratings document answers frequently asked questions about the possible impact of COVID-19 and recession on public finance ratings. Specifically, the FAQ notes that for the remainder of 2020, all public sector outlooks are now negative, although S&P notes this does not mean individual issuer outlooks are changed. The FAQ also states, “the rapid onset of recession with swift GDP decline and sharp unemployment” is more typical of a natural disaster than a typical recession. S&P Global will regularly update its credit rating commentaries and activity, available at COVID-19 Activity In U.S. Public Finance.
In March, FitchRatings reported that despite the coronavirus outbreak U.S. water and sewer utilities’ strong sector liquidity means that these agencies should be able to “move forward with necessary projects without significant disruption.”