Moody’s: Easing of hostility with N. Korea is credit positive for S. Korea

The US-based ratings agency, Moody’s Investors Service, is out with its credit ratings review on South Korea, in the wake of the ongoing peace treaty between North and South Korea.

Key Points:

Moody’s rates South Korea at Aa2.

The easing of hostility with North Korea is credit positive for South Korea.

Declaration announced by the two Koreas is a prelude to more substantive negotiations.

This will help to lower geopolitical risk.

Although the pledge to carry out disarmament seems unlikely, at least in full, in the absence of more significant trust-building measures.