Sovereign Debts Rating: An Overview Chapter 8 in The Palgrave Handbook of Public Debt and Policy Mix, MacMillan, à paraitre (2026)

In this chapter, we examine how rating agencies (CRAs) have developed their methodologies and strategies with regard to sovereign issuers, particularly in the context of the sovereign debt crisis in the Eurozone (2010-2013) and the crisis affecting the poorest countries since 2020. We analyse how changes in CRA regulations have influenced the performance, transparency and objectivity of sovereign ratings, as well as modifying their impact on the markets of the countries concerned and their procyclical effect. Comparing the assessment of sovereign risk through agency ratings and market risk premiums reveals significant differences in assessment bias. In the case of developed countries, ratings deteriorated only slightly on average between the two crises, adjusting slowly and with a delay to market risk premiums despite a sharp increase in public debt. In contrast, newly but moderately indebted developing countries suffered severe downgrades, which were subsequently justified by an increase in defaults. Therefore, it cannot be concluded that they were subject to negative rating biases. Overall, it seems that CRAs have become more cautious in their ratings and consequently more 'market-following', resulting in a loss of influence on the market and diminished impact on the economies of the rated countries