S&P’s negative outlook had been in place since December 2019, reflects risks to the fiscal and external balances.
The stable outlook indicates that the government’s fiscal consolidation agenda is perceived as credible and that Romania’s public and external finances are seen stabilizing over the next two years, S&P said in a press release late Friday.
“Standard & Poor’s decision recognizes Romania’s efforts to ensure is fiscal consolidation and confirms that the government’s measures were correct, necessary and expected by our international partners,” said finance minister Alexandru Nazare.
S&P said it revised the outlook to stable mainly because Romania’s short-term fiscal risks have abated. The government has rolled back costly pension hikes that had previously been legislated and has also charted a consolidation course that will ensure that Romania’s government and external debt stocks remain moderate through 2024, the agency said.
Meanwhile, Moody’s, which rates Romania at Baa3 negative, has not taken any rating action. A review by Fitch Ratings, which rates Romania at BBB negative, is expected at the end of this week.