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S&P revises Nicaragua outlook to negative

S&P Global Ratings revised its outlook on Nicaragua to negative from stable, citing the country's ongoing political unrest.

Political tensions are building in the country following protests against the government that started in April over plans to reform the country's pension system. Despite the cancellation of the measure, political tensions remain high as protesters seek justice for those who died during the protests and demand democratic reforms.

The rating agency said this discord disrupted Nicaragua's economic activity and hurt cooperation between the government and the private sector. S&P noted that prolonged political unrest could pose long-term risks to the country's economy, which would result in a rating downgrade.

"We could lower the ratings in the next few months if the current political impasse persists or worsens, auguring greater long-term negative consequences for the economy," S&P said.

The rating agency affirmed Nicaragua's B+/B foreign and local currency sovereign credit ratings.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings. The original S&P Global Ratings documents referred to in this news brief can be found here.