Fitch: Tough Year for Brazilian Corporates
Liquidity is a still short-term relief, but credit quality should deteriorate in 2015. Fitch expects downgrades to outpace upgrades for Brazilian corporates during the year. Brazilian corporates are likely to face tough conditions in 2015 due to a combination of weak demand, persistent high inflation, declining commodities prices, rising interest rates and foreign exchange volatility. This challenging macroeconomic scenario should pressure operating cash flow generation (CFFO), leading to leverage increase.