S&P downgrades Mexico sovereign rating to BBB, from BBB+
Adds comments from S&P, background, peso's movement
March 26 (Reuters) - Credit ratings agency S&P on Thursday lowered Mexico's sovereign credit rating to BBB from BBB+ due to an expected economic hit from the coronavirus pandemic and a plunge in oil prices, piling pressure on the government to lift the struggling economy.
"The pronounced COVID-19 and oil price shocks, in our view, exacerbate Mexico's already modest growth," S&P said in a statement.
Mexico's economy is already in recession and the coronavirus crisis and falling crude prices have battered the outlook.
S&P said it expected Mexican gross domestic product (GDP) to decline between 2% to 2.5% in 2020 and then rebound in 2021 by a little over 2%.
"The downgrade reflects our revised expectations that real per capita GDP growth will remain below that of peers with a similar level of economic development," S&P added.
S&P put Mexico's outlook on negative and lowered its long-term local currency sovereign credit rating to BBB+ from A-.
Mexico's peso MXN= dropped over 1.6% against the dollar following the downgrade.
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(Reporting by Noe Torres and Anthony Esposito; Editing by Lisa Shumaker)
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