Moody’s Investors Service changed on December 11 Romania’s rating outlook from stable to positive and affirmed the country’s sovereign rating at Baa3 (investment grade), the Public Finance Ministry announced on Saturday.
“The key drivers for changing the outlook on Romania’s ratings are the country’s significant progress in correcting its macroeconomic imbalances, reducing the economy’s vulnerability to external shocks and paving the way for robust economic growth. Also, Romania’s sizeable fiscal adjustment in the recent past, leading to a significant reduction of the government’s fiscal deficit and contributing to a stabilization of the government’s debt-to-GDP ratio” are cited among the rating agency’s drivers for this move.
Moody’s also forecasts Romania’s economic recovery to gain further momentum in 2016, thanks to a robust expansion of private consumption and investment as well as solid public consumption growth, which will allow real GDP growth to accelerate to 4.1 pct in 2016, from 3.5 pct in 2015.
The agency also notes in this context that Romania’s medium-term growth outlook is more favorable than many of its peers, including Bulgaria, Spain, Azerbaijan, Portugal or Hungary. Moody’s also expects Romania’s debt level to decline to 39.4 pct of GDP in 2015 (from 39.9 pct in 2014).
The rating agency also expects that continued integration with the European Union will contribute to improvements in Romania’s institutional framework and capacity.
In August this year, Fitch Ratings affirmed Romania’s long-term foreign and local currency Issuer Default Ratings (IDR) at ‘BBB-‘ and ‘BBB’, with stable outlook. Two months later, in early October, Standard & Poor’s Ratings Services affirmed in its turn Romania’s sovereign credit ratings at BBB-/Stable/A-3.