Moody’s upgrades Czech Republic credit rating
Moody’s Investors Service upgraded the Czech Republic’s credit rating one level to Aa3 from A1. Moody’s cited Czechia’s low debt and budget perfomance as key factors in its decision to raise the countries credit rating for the first time since 2002. Moody’s adjusted their outlook rating for the country from positive to stable.
Forecast: Czech Debt to continue to decline
The budget deficits are expected to fall to under 1% of GDP in the coming years. Positive economic growth will contribute to the decline in deficit. The agency predicts Czech debt will continue to decline this year, reaching 30.8% of GDP in 2020, falling below 30% of GDP by 2023.
Strong fiscal framework
Moody’s also said “The strong fiscal framework, and adherence to its rules, is another area where the Czech Republic compares strongly to peers.”
The governments innovation agenda and progress in the labor market and education were cited by Moody’s as crucial to the stable rating outlook for the country.