Moody’s affirms Greece’s Ba3 ratings; changes outlook to positive from stable

Moody’s on Friday upgraded Greece’s outlook to positive from stable and affirmed its ratings of Ba3.

According to an announcement posted on its website, the international ratings firm stated that “…the main drivers for the outlook change to positive are prospects of a period of higher nominal GDP growth than in the past decade, partly the result of improvements in governance and effective past economic and banking sector reforms which are more visibly bearing fruit. Together with continued commitment to sound fiscal metrics supported by the implementation of fiscal measures, higher nominal GDP growth will contribute to a marked decline in Greece’s debt burden in the next few years,” it stated, adding:

“The affirmation of Greece’s Ba3 ratings reflects a balance between the improvements seen in many areas of Greece’s credit profile with persisting challenges. In particular, further reforms in the areas of justice, education, business environment and labour markets would support a higher rating. Moreover, the government debt burden remains very high and supported by official creditors, with future improvements and full return to market-based financing involving the maintenance of large primary surpluses for years to come.”