Caption: Finance Minister Davendranath Tancoo
TRINIDAD and Tobago’s credit rating was reaffirmed Friday by Moody’s Investors Service at Ba2 for both local and foreign currency long-term issuer and senior unsecured debt. However, the rating agency shifted the outlook to negative, signalling potential deterioration in the near term amid what it regards as short-term downside risks.
In a news release, the Ministry of Finance framed Moody’s decision as a balance between persistent strength and near-term pressures. The ministry cited robust credit fundamentals, including substantial fiscal buffers such as the Heritage and Stabilization Fund (HSF) and other cash-equivalent assets, which Moody’s notes total about 45% of GDP. The release also pointed to expected positive developments in oil and gas production by 2027 as a supporting factor for the economy.
The negative outlook, Moody’s explained, stems from a decline in the Central Bank’s liquid foreign exchange reserves. The rating agency noted, in its methodology, that this measure does not include the HSF, which the ministry argues understates the overall liquidity cushion available to the economy.
Finance Minister Davendranath Tancoo said the rating was expected to be maintained, but suggested Moody’s should have allowed more time to evaluate the impact of recently announced government policy measures. The agenda aims to rebalance growth, revitalise the economy, secure a sustainable fiscal path, and stabilise foreign exchange reserves, he said.
“The decline in Moody’s narrow definition of foreign exchange reserves happened to be the contributing factor in their negative outlook,” Tancoo said.
He added that Trinidad and Tobago’s net international investment position remains in surplus relative to the rating scenario, and reiterated that the HSF’s assets are not captured in Moody’s foreign exchange reserve metric.
Tancoo also criticised the timing of the adjustment, noting that measures implemented to support Fiscal 2026 had not yet had a chance to bear fruit.
The government’s move comes amid a global backdrop of mixed credit assessments for the country. In July, Standard & Poor’s (S&P) rated Trinidad and Tobago at investment grade BBB-, but changed its outlook to negative.
