China’s Dagong Global Credit Rating has restated its rating on Brazil as “A-“, three levels above the rating announced last week by Standard & Poor’s, the Brazilian press reported.

“The basically stable political situation in Brazil and the advantage of current president Dilma Rousseff in the presidential election are favourable factors for continuation and stability of policies,” said the report issued in Beijing.

The Chinese agency said, however, that “the political climate in Brazil places difficulties on the introduction of structural reforms,” and it gave a warning about fiscal policy, noting that “the budget deficit and the debt situation have consistently got worse.”

Affected by a significant rise in public expenditure, the budget deficit rose to 3 percent of GDP in 2013,” said Dagong, whose economists expect public debt to increase to 68.2 percent of Gross Domestic Product in 2014.

The Dagong Global Credit Rating Co., Ltd. Was established in 1994 by a joint decision of the People’s Bank of China and the former State Economic and Commercial Commission, and is China’s government-recognised credit rating agency. (macauhub)