Like it or not, the world’s largest ratings agencies can make or break a country’s economy – and Moody’s has just given Portugal’s new government the kind of rating it needed.
Despite all the rumblings said to be emanating from Brussels over Portugal’s State Budget, Moody’s has given it the thumbs-up, calling it “credit positive” and saying it “removes the risk of early elections”.
Moody’s stressed that the government implemented a number of changes, in response to pressure from Brussels, and that this showed its “capacity and willingness” to set out a “more realistic fiscal course”.
The bottom line, nonetheless, is that PS growth targets may still be too high, writes the Financial Times.
Moody’s suggest 1.6% (as opposed to the government’s forecast of 1.8%), says the paper.