OREANDA-NEWS. In its Latin American Sovereign Overview, Fitch Ratings has revised its 2015 real GDP growth forecast for the region down to -0.6%, from +0.5% in April, as external headwinds and domestic challenges affect most of the region's sovereigns, and recessions in Brazil and Venezuela continue to deepen. While Fitch has reduced its growth forecast for most regional economies, rating trends are generally stable, with only two countries (Brazil and Costa Rica) currently carrying a Negative Outlook. Rating actions have been evenly balanced, with two upgrades (Bolivia and Paraguay) and two downgrades (El Salvador and Brazil) so far this year. Jamaica is the only sovereign that currently has a Positive Outlook.

External headwinds from China's slowdown and lower commodity prices, combined with domestic challenges such as weaker confidence and heightened political noise, have had a negative impact on commodity exporters' growth, fiscal accounts and external dynamics. While financial volatility has increased for Latin America and other EMs, flexible currencies and the build-up of significant buffers have helped Latin American sovereigns to absorb external shocks. On the fiscal side, regional deficits are expected to widen from 3.9% in 2014 to 4.3% in 2015, due to lower commodity-related revenues, slower growth and continued spending pressures.

The full Latin American Sovereign Overview provides a summary of the credit profile of each of the 19 rated sovereigns in Latin America and the Caribbean, as well as an overview of recent macroeconomic developments and rating trends. The report is available at 'www.fitchratings.com'.