Sign in Get in touch
World risk · Finance and markets · Global debt & markets

Colombia loses its last investment-grade credit rating

The test Between 28 Oct 2026 and 31 Oct 2027, Colombia's long-term foreign-currency sovereign rating falls below investment grade at all three main global agencies (Moody's to Ba1 or lower).

Not under way · Confidence: medium · Reviewed 28 Oct 2026 · Scores from 1 to 10

This page answers: What could happen, how it is scored, and who is exposed?

Using this page
  1. Read the two scores: Likelihood and Impact are kept apart.
  2. Check what is happening, each fact with its source.
  3. Use the calendar for the dates to watch.

Follow this riskSign in to follow; one weekly email if you ask for it.

Likelihood
4Elevated steady this month
Impact
4Elevated steady this month
Breadth4
Depth1
Duration7
Hard to substitute4
Canada pointNot added0

Impact is the average of the four parts, rounded, plus one point when Canada is directly hit on two or more channels, up to 10.

Two separate scales from 1 to 10. Strature never multiplies or merges them.

What changed

Dated, newest first

  1. Budget approved 20 Oct; bill to cut spending by 2.2% of GDP within three months; 2027 deficit projected at 9.4% [8]
  2. 2027 budget COP$634.9tn; analyst Andrés Pardo's reading of the first proposal: deficit 9.4% of GDP, issuance COP$238.6tn, net debt 66.2% of GDP [7]
  3. IMF help requested; cuts of 2.2% of GDP; about US$27bn external financing; FCL of about US$8bn cancelled earlier [9]

Why it matters

Two of the three main agencies already rate Colombia below investment grade: S&P cut it to BB- in April 2026 and Fitch to BB in December 2025. Moody's still holds it at Baa3, the lowest investment grade, with a stable outlook since 26 Jun 2025. Congress passed a 2027 budget on 20 Oct; the government projects a 2027 deficit of 9.4% of GDP. The risk is that a Moody's cut takes Colombia below investment grade at all three.

Why Likelihood 4 Pushes: Moody's 2026 deficit view above target; rising debt; large external financing needs. Brakes: Moody's outlook stable; adjustment law; IMF talks; Fitch sees no near-term pressure. No source leans towards a Moody's cut in the window, so 4.

Why Impact 4 Threshold case: Moody's to Ba1; key price the dollar-bond spread (no sourced move).

The other facts on file (9)
  • Moody's cut Colombia to Baa3 from Baa2, outlook stable [1] (26 Jun 2025)
  • S&P cut the foreign-currency rating to BB- from BB, outlook stable [2] (9 Apr 2026)
  • S&P could cut again in 6-18 months if higher deficits drive persistent external outflows [3] (9 Apr 2026)
  • Fitch cut to BB from BB+ on 16 Dec 2025, outlook stable [4] (17 Dec 2025)
  • Fitch (Richard Francis): no near-term rating pressure; committee expected in December; interest near 4% of GDP [5] (18 Aug 2026)
  • Moody's: 2026 deficit about 6% of GDP vs 5.1% target [6] (13 Mar 2026)
  • Moody's cut ISA to Baa3 (review opened 24 Apr 2026), citing parent Ecopetrol's downgrade [10] (6 Aug 2026)
  • 2021 estimates of forced selling at the second downgrade: up to US$1.5bn dollar bonds (Citi); US$1.4-2.6bn TES at risk (Credicorp) [11] (22 May 2021)
  • JPMorgan put TES outflows after S&P's 2021 cut at about US$3.5bn [12] (20 May 2021)

Where it sits

Bab el-MandebStrait of HormuzStrait of MalaccaPanama CanalSuez CanalTaiwan Strait11. Colombia loses its last investment-grade credit rating: Elevated impact · possible1 · Elevated impact · possibleBab el-MandebStrait of HormuzStrait of MalaccaPanama CanalSuez CanalTaiwan StraitUNITED STATESUNITED KINGDOMJAPANNORWAYFRANCEITALYPACIFIC OCEANINDIAN OCEANMap data: Natural Earth (public domain).
Bab el-MandebStrait of HormuzStrait of MalaccaPanama CanalSuez CanalTaiwan Strait11. Colombia loses its last investment-grade credit rating: Elevated impact · possibleBab el-MandebStrait of HormuzStrait of MalaccaPanama CanalSuez CanalTaiwan StraitUNITED STATESJAPANFRANCEINDIAN OCEANMap data: Natural Earth (public domain).

How it spreads

If

Between 28 Oct 2026 and 31 Oct 2027, Colombia's long-term foreign-currency sovereign rating falls below investment grade at all three main global agencies (Moody's to Ba1 or lower).

Not under way

Channels 4 on the card

  1. CanadaNo Canadian channel sourced.
  2. Forced sellingMandates needing one investment-grade rating sell; the 2021 estimates (US$1.4-2.6bn [11], about US$3.5bn [12]) were for the second agency's cut, already past.
  3. Borrowing costsAbout US$27bn of external financing planned [9] at higher cost.
  4. State firms and banksRatings tied to the sovereign [2][10].

Sectors 2

  • Banks and insurers
  • Energy and pipelines

Countries 1

Who is exposed

Countries
Colombia
Sectors
Government debt, Banks and insurers, State energy, Power transmission

Three scenarios and their signposts

  1. S1

    Hold at Baa3

    The adjustment law passes and an IMF arrangement anchors the plan.

  2. S2

    Outlook negative

    Moody's moves the outlook first.

  3. S3

    All three junk

    The spending-cut bill stalls and Moody's cuts to Ba1.

The signposts of each scenario
PathSignpost
S1Congress approves the spending-cut law
S2A Moody's outlook change after the 2027 budget
S3The June 2027 medium-term fiscal framework misses its own path

No probability is given for the three paths.

Dates to watch

Calendar

The dates to watch

A dot is a day, a bar a month or a year; a hollow mark is tentative. The line marks today.

  1. Dec 2026 Fitch committee on the 2027 budget [5] Tentative · Outside event
  2. 1 Jan 2027 2027 budget in force [7] Declared · Outside event

    Remind me

  3. 31 Oct 2027 End of the scored window [7] Declared · Strature date

    Remind me

Sign in, with alerts on, for an email 7 days and 1 day before.

SourceStrature world-risk card; the dates cite the sources below.
Exhibit R-3 · COLOMBIA · strature.net

The other side

A cut after Colombia already lost two ratings costs less: index exits happened in 2021 [11]. A credible IMF-backed plan [9] could instead lift the outlook, and Fitch says a dollar near 3,100 pesos helps soften the interest bill [5].

Connected in Strature

Sources

12 sources, numbered as the text cites them

  1. Comunicado: decisiones de Moody's y S&P sobre la calificación de Colombia. Ministerio de Hacienda y Crédito Público · 26 Jun 2025 · Official · confidence high · retrieved 28 Oct 2026
  2. Rating Actions Taken On Ten Latin American Financial Institutions Following Downgrade Of Colombia To 'BB-'. S&P Global Ratings (via Findeter) · 9 Apr 2026 · Official · confidence high · retrieved 28 Oct 2026
  3. S&P Global rebajó la calificación soberana de Colombia a niveles no vistos desde 1993. La República · 9 Apr 2026 · News · confidence medium · retrieved 28 Oct 2026
  4. Fitch rebaja la calificación de Colombia en otro peldaño tras déficit creciente. Bloomberg (via Yahoo Finanzas) · 17 Dec 2025 · News · confidence medium · retrieved 28 Oct 2026
  5. Fitch revela cuándo revisará calificación soberana de Colombia (Valora Analitik). Yahoo Noticias · 18 Aug 2026 · News · confidence medium · retrieved 28 Oct 2026
  6. Moody's espera déficit fiscal de 6% del PIB en 2026, 0,9 pps arriba de meta del Gobierno. La República · 13 Mar 2026 · News · confidence medium · retrieved 28 Oct 2026
  7. Congreso aprobó Presupuesto de 2027 por $634,9 billones. Forbes Colombia · 20 Oct 2026 · News · confidence medium · retrieved 28 Oct 2026
  8. El Congreso colombiano aprueba el presupuesto de 2027 con un elevado déficit fiscal. La Nación (Paraguay) · 21 Oct 2026 · News · confidence medium · retrieved 28 Oct 2026
  9. Colombia: acorralado por un déficit récord, De la Espriella pide apoyo al FMI para enfrentar la crisis. El Observador · 29 Sep 2026 · News · confidence medium · retrieved 28 Oct 2026
  10. ISA profit climbs 9% in first half as Moody's cuts its rating to Baa3. The Rio Times · 6 Aug 2026 · News · confidence medium · retrieved 28 Oct 2026
  11. Colombia en riesgo de venta forzada de bonos si hay más rebajas (Bloomberg). Gestión · 22 May 2021 · News · confidence medium · retrieved 28 Oct 2026
  12. JPMorgan: Impacto moderado en salida de capitales de Colombia. Valora Analitik · 20 May 2021 · News · confidence medium · retrieved 28 Oct 2026

Reviewed 28 Oct 2026 · version 1 · last change: first review · All risks