Morgan Stanley | Fitch has raised its rating perspective for Portugal to positive. This was unexpected and seems to support the market thesis that Portugal’s fundamentals are at similar levels to Spain and Italy. Our macro analysts agree but see posible downside risks.
Fitch´s rating for sovereign debt if BBB, and the rise in the rating perspective to positive suggests that Fitch sees potential for a posible future rating rise, provided economic perspectives remain robust and public debt continues its downward trend.
However, our macro analysts see the following risks:
- We think that growth is still robust, but we do not expect many changes in fiscal policy in the short term.
- With the production breach closed, our macro analysts expect the growth dynamic to slow.