Question

Which of the following factors affect the Credit Rating of a Country?
1 Demographic Dividend
2. Inflation
3. Foreign Investment
4. Fiscal deficit
5. GDP growth
Select the correct answer using the codes given below:

• A. Only 2, 3, 4 and 5
• B. Only 1, 2, 3 and 4
• C. Only 3, 4 and 5
• D. All of the above

Answer 1

The correct option is A Only 2, 3, 4 and 5

Credit rating companies like CRISIL, S&P, Moody’s etc. also give credit ratings (AA, A, BBB, C, D etc.) to countries based on their eco-political conditions. India hold a credit rating in medium risk category just above the junk status.
Factors affecting credit rating are
1. Fiscal deficit
2. Inflation
3. Infrastructure
4. Foreign investment
5. GDP growth