Fitch keeps rat­ing at ‘B,’ out­look sta­ble

Kathimerini English - - Front Page -

Fitch Rat­ings re­tained Greece’s sov­er­eign credit rat­ing at ‘B’ and its out­look as sta­ble late on Fri­day but warned of a down­grade should snap elec­tions prove in­con­clu­sive or ne­go­ti­a­tions with the coun­try’s cred­i­tors fail to re­sult in an agree­ment.

Among the key con­clu­sions in the Fitch re­port are that the coun­try’s fund­ing needs for the next six months are fully cov­ered and that talks with the cred­i­tors could be ex­tended into next year.

Fitch had up­graded Greece to ‘B’ from ‘B-’ in May, bring­ing the coun­try’s rat­ing five notches be­low in­vest­ment grade. It now says that the 2014 bud­get will meet its tar­gets thanks to an un­prece­dented fis­cal adjustment and that fis­cal fig­ures are also likely to out­per­form ex­pec­ta­tions. Fol­low­ing the stress tests banks need no fur­ther cap­i­tal, Fitch said.

It points out that the econ­omy is bot­tom­ing out but warns of the risk that the next gov­ern­ment to emerge from pos­si­ble snap polls in March could be less com­mit­ted to eco­nomic and fis­cal re­forms. The achieve­ment and sus­tain­abil­ity of the midterm tar­get for a pri­mary sur­plus of 4 per­cent will de­pend on con­tin­ued fis­cal dis­ci­pline and on eco­nomic growth, Fitch stresses.

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