Which factor is associated with a more favorable quality sovereign bond credit rating?

Question

Quizplus · Accepted Answer

Sovereign bonds issued in local currency of a country with a strong domestic savings base are associated with a more favorable quality credit rating. This is because such investments offer lower foreign exchange risk, as investors are not exposed to the fluctuations of the currency exchange rate. Additionally, a strong domestic savings base indicates a stable economy with a low risk of default, which positively impacts the country's credit rating.

Which Factor Is Associated with a More Favorable Quality Sovereign