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Fitch upgrades Ireland rating to A-minus

Monday, August 18 08:48:47

Fitch Ratings upgraded Ireland's sovereign credit rating to 'A-minus' on Friday, becoming the second of the three main ratings agencies to give the country an A-rating for the first time since its banking crisis.

The ratings agency upgraded Ireland to 'A-minus' from 'BBB-plus' with a stable outlook, citing the country's continued fiscal consolidation over the last year.

"The Irish government has continued its multi-year fiscal consolidation program following the exit from the Troika program at the end of 2013 and remains compliant with domestic and euro zone fiscal rules," the ratings agency said. (http://bit.ly/1BkWB1j)

The troika bailout program includes cooperation between the International Monetary Fund, the European Commission and the European Central Bank in countries requiring financing after the financial crisis.

Fitch said it assumes that the efforts towards fiscal consolidation would continue in 2015 that would see the country exit the excessive deficit procedure by next year.

The excessive deficit procedure is an action launched by the European Commission against any European Union (EU) Member State that exceeds the budgetary deficit ceiling imposed by the EU's Stability and growth pact legislation.

Fitch's move follows a similar rating action from Standard & Poor's, which upgraded Ireland's rating to 'A-minus' from 'BBB-plus' in June. Moody's currently has a lower rating of 'Baa1'.

Fitch's latest change gives Ireland a median A-rating from the three agencies, which is required by some investors to increase their weighting in Ireland bonds.

Ireland, whose bonds were junk-rated by Moody's until January this year, completed an 85 billion euro EU/IMF bailout last year and has been selling debt at record lows in recent months.

Fitch on Friday also raised the country's ceiling to 'AAA' from 'AA-plus'. (Reuters)

For more visit: www.businessworld.ie