Fitch improves Bulgaria's outlook to 'positive'
Global rating agency Fitch has revised its outlook for Bulgaria to "positive" from "negative", citing reduction in the country's debt and recovery of the economy.Should debt decline further and local banks display clearer evidence of stabilization, the agency could upgrade its ratings, the analysts said.In early May, rating agency Moody's said it was examining Bulgaria's rating for a possible upgrade, which could happen at the start of July.Fitch also considers that Bulgaria could be affected by low domestic demand and possible consequences from issues at Greek banks. So far, however, the problems of the financial entities in the neighbouring country have not spread to Bulgaria's banking system, although some of the major lenders operating in Bulgaria are owned by Greek banks.Bulgaria's economy expanded by an annual 2.5 per cent in the first quarter of 2011, but at the same time the country continued to experience a decline in domestic consumption and frozen income. Exports are considered the main growth driver for the recovery, as they jumped 22.2 per cent on the year in January-March, while domestic demand and investments dropped by 2.1 per cent and 2.7 per cent, respectively. (Source: The Sofia Echo)