S&P cuts BHP's ratings, puts Rio on watch

Sydney

RATINGS agency Standard & Poor's on Tuesday lowered the credit ratings of BHP Billiton and put it on negative watch, while it placed Rio Tinto on negative watch, both actions due to challenging market conditions.

The ratings agency cut BHP's debt to A from A-plus and said a further downgrade by one notch will depend on BHP's dividend policy and capital expenditure guidance due out this month. The move reinforced market speculation the miner will have to lower its payout to shareholders.