Fitch Ratings kept Greece’s credit rating at “BB-” with a stable outlook on Friday night, as the country has enjoyed record low yields for its sovereign bonds in the last month after the election of a new center-right government on July 7.
In its report, Fitch said it is still waiting to assess the government’s performance before deciding on a rating action, arguing that “it is too early to assess government effectiveness and policy implementation.”
However, it also said that “the advent of a single-party majority government should help cement the improvement in political stability seen in recent years.”
“It is quite normal that the rating agencies should wait first for tangible results from the new government’s policies. It is not enough for them just to see new measures passed into law but also to see them implemented in practice,” Dimitris Kenourgios, assistant professor of finance at the University of Athens, told Xinhua on Saturday.
Fitch’s rating remained three notches below investment grade, while Greece’s rating by the Standard & Poor’s and Moody’s agencies is four notches below investment grade. Upgrades should be expected later in the year, said the expert.
“We should not be too anxious to see our sovereign rating upgraded just yet, but I expect that by the end of the year or early in 2020 we will get within reach or actually obtain investment grade,” Kenourgios told Xinhua. [Xinhua]