Recent adjustments to Bulgaria’s credit rating from Fitch Ratings mirror the country’s continued economic growth, with Bulgaria’s outlook advancing from stable to positive and ratings affirmed in three areas.
Fitch Ratings set Bulgaria’s Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at BBB-, according to a release from the Bulgaria Ministry of Finance. The agency also put Bulgaria’s Country Ceiling at BBB+ and its Short-Term Foreign and Local Currency IDRs at F3.
In making its rating determinations, Fitch cited Bulgaria’s GDP forecasts, giving the country an estimated 3 percent growth for 2017-18 and its public finances. Fitch has forecasted a fiscal deficit of 0.6 percent of GDP for Bulgaria this year. Both of these factors put the country in contention with its BBB peers, with its public debt below the projected BBB median and its GDP growth rate within the BBB median.
For further ratings improvements, Bulgaria needs stronger GDP growth, higher economic growth without external imbalances and fiscal stability and sustainable public debt. If the country experiences larger fiscal deficits or adds contingent liabilities to its budget, it can expect it’s outlook to move back to stable.
