Rating agencies are USD muppets

For too long the rating agencies have dished out foreign currency ratings with the USD deemed as the ultimate foreign currency. While sovereign rating analysts are quick to point out the failings of emerging market economies that adopt poor economic, fiscal and monetary policy and which often lead to a depreciation of the local currency against the USD, the 7% annual loss for the last six years in the USD against a global currency basket has been conveniently ignored. For global investors, the USD depreciation has been a major loss of value.
Of course, printing money to destroy its value is the way for any government to reduce the burden of debt, but the global rating agencies do the world a disservice if they only look at life through greenback tinted spectacles.
While rating agencies have sought to distance themselves from valuation, all their models for structured finance, work backwards from an assumed valuation or recovery given default. Thus while many AAA rated obligations have been downgraded, few have defaulted - the downgrades generally representing the risk of greater loss.
So Moody's et al, hurry up and downgrade likely value destruction wherever it is. There is no excuse not to use a global currency index; if spreadsheets can support your quantitative risk models, running a foreign currency basket programme is a doddle. If foreign currency ratings aren't based on the most reliable currency benchmark (absent a gold standard) then outcomes too will be second rate.