RATINGS: Austria’s Negative Outlook At Moody’s Set For Review After Close
Potential sovereign rating reviews of note scheduled for after hours on Friday include:
- Moody’s on Austria (current rating: Aa1; Outlook Negative), Estonia (current rating: A1; Outlook Stable), Luxembourg (current rating: Aaa; Outlook Stable), the Netherlands (current rating: Aaa; Outlook Stable) & Switzerland (current rating: Aaa; Outlook Stable)
- Morningstar DBRS on Latvia (current rating: A, Stable Trend)
- Please use this link to access the indicative 2026 sovereign rating review schedules across the five most prominent rating agencies (Fitch, Moody's, S&P, Morningstar DBRS & Scope Ratings).
- Note that the schedules are indicative only and ratings can be reviewed on an ad-hoc basis.
- Rating agencies may also adjust their schedules during the year.
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ECB: Villeroy Re-iterates Downside Inflation Risks, Notes Dollar Weakness
Comments from Banque de France Governor Villeroy at a senate hearing: “The downside risks to inflation are at least as significant as the upside risks — a possible depreciation of the dollar, if the independence of the Federal Reserve were to be threatened, is among these downside risks,”...“We will therefore remain pragmatic and agile at each of the upcoming meetings of the ECB Governing Council.”
Not a surprising set of comments from Villeroy, nowadays considered one of the more dovish members of the GC.
- Yesterday, he said it was a "misconception" to think a hike could be delivered in 2026
- Note that MNI's latest sources piece, released yesterday, highlighted that the bar for cutting rates because of FX developments would be a high one, even if the exchange rate does have an impact on inflation... It was argued that the main concern should not be any appreciation against the dollar but rather a rise in the euro’s trade-weighted value.
US-RUSSIA: BBG-Witkoff & Kushner Seek Putin Meet; Ukraine Eyes US Sec Guarantees
Bloomberg News reports that US special envoy Steve Wtikoff and President Donald Trump's son-in-law Jared Kushner are looking to visit Moscow in the near future for talks with Russian President Vladimir Putin. The meeting could take place in January, but international events drawing focus from the Ukraine peace talks could see the timing slip. Moreover, Putin may not be convinced of the need for another meeting amid Russia's refusal to back down from its demand that Ukraine withdraw its troops fully from the Donbas as part of any peace agreement.
- Other issues where there appears to be no common ground between Russia and Ukraine and its allies include the potential presence of NATO peacekeeping troops, control of the Zaphorizhzhia nuclear power plant, and what will happen to the ~USD300bln in frozen Russian assets held in Western financial institutions.
- At present, it appears the political pressure is falling more on Putin than Ukrainian President Volodymyr Zelenskyy, with Trump saying earlier in Jan he is "not thrilled" with Putin, with the US having prepared further sanctions. Of course, Zelenskyy and Ukraine remain under tremendous physical pressure from Russia's continued aerial bombardments and the slow but sustained Russian advances in the Donbas and Zaporizhzhia.
- The US, Europe and Ukraine are also seen to be closing in on a deal regarding security guarantees and ceasefire monitoring that would look to deter any future Russian aggression. G7 leaders travelling to Davos next week for the WEF annual meeting, where Trump is speaking, is viewed as a signal that an agreement is close.
