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ECONOMY
What are the implications of the exac- cording to which it could be refinanced.
erbated credit rating? The credit rating and the increased costs of refi-
Credit rating, as it was indicated above, is a gen- nancing, as well as the determined Credit Ceilling
eral assessment of the credit ability of the ranked also have implications on the prices according to
subject. The exacerbated creditworthiness can af- which the Macedonian companies could borrow
fect both the country’s approach to international abroad, as well as the cost of capital. Namely, the
financial markets, as well as the prices according interest rate of the debt securities issued by the
to which a new debt could be issued. If one analyz- country is one of the main input values in the for-
es the interest rates of the last three bonds issued mation of the commercial interest rates, as well as
in the international financial market, one could say a reflection of risk in Capital Asset Pricing Models
that the market already perceived the increased which are being used in the determination of cost
risk considering the fact that the interest rate of capital when the companies decide to invest in a
of 3.975 % for the seven-year bond issued in 2014 specific country both in securities, as well as in the
raised to 5.625% for the seven-year bond issued in real sector.
2016. The difference in yield compared to the Ger-
man federal government bonds of the last bond is- Considering the fact that the change in rating
sued in 2016 at the moment of writing of this text also refers to the long-term debt in local curren-
is 4.861%. Therefore, one can conclude that there cy, it is obvious that this change will entail some
are risks in regard to the capacity to refinance the changes in the valuation of the portfolios of the in-
already accumulated public debt and the price ac- vestors who invested in long-term debt securities
in local currency.
