OVERVIEW Mixed policy signaling by the government, with negative implications for fiscal accounts and economic policy credibility, coupled with a subdued outlook for growth over the next two years continue to weigh on Brazil's policy flexibility and performance profile. We are lowering our long-term foreign currency sovereign credit rating to 'BBB-' from 'BBB' and our long-term local currency sovereign credit rating to 'BBB+' from 'A-'. The stable outlook reflects Brazil's institutional and balance sheet strengths, both fiscal and external, despite recent policy slippage, the combination of which supports our ratings in the low-investment-grade category. RATING ACTION On March 24, 2014, Standard&Poor's Ratings Services lowered its long-term foreign currency sovereign credit rating on Brazil to 'BBB-' from 'BBB' and
