Credit rating agencies have information value beyond that already publicly available to the market, and can negatively affect the price of credit default swaps, according to an International Monetary Fund paper published on January 20.

John Kiff, Sylwia Barbara Nowak and Liliana Schumacher, the paper's authors, examine the impact and accuracy of sovereign ratings and how influential they are for financial stability. While ratings produced by the major rating agencies perform reasonably well when