Fitch Maintains Bulgaria’s Credit Rating At ‘BBB-‘ With Stable Outlook
Fitch has affirmed Bulgaria's long-term foreign and local currency Issuer Default Ratings (IDR) at 'BBB-'and 'BBB', respectively, with stable outlook.
According to the global rating agency, the affirmation and stable outlook reflect Bulgaria's government plans to target expenditure-driven fiscal consolidation, with the aim of reducing the headline fiscal deficit by 0.5 percentage points a year in 2015-2017.
“However, based on our expectation of weaker economic growth relative to the government's forecasts, we expect an average reduction of 0.3pp annually,” Fitch said in a statement late on Friday.
Another factor behind the affirmation and the stable rating outlook is that Bulgaria’s public finances compare favourably with rating peers despite the negative impact they suffered in the second half of 2014.
Looking at Bulgaria’s banking sector, Fitch said it has stabilized following “substantial bank runs in June 2014”.