Home Malta Winds Fitch affirms Malta’s ‘A+’ rating with a positive outlook

Fitch affirms Malta’s ‘A+’ rating with a positive outlook

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The Ministry
for Finance welcomes the latest credit rating report issued by Fitch which
affirmed Malta’s rating at ‘A+’ with a positive outlook.

The ‘A+’
rating reflects Malta’s institutions which are considered stronger than the
majority of similarly rated countries. Malta also outperformed the ‘A’ median
on the World Bank human development and governance indicators.

The positive
outlook reflects Fitch’s expectation of sustained high economic growth from
diverse sources in the medium term. As a result, it expects Malta’s per capita
income to continue converging to the EU average in the coming years.

The firm
downward trajectory in the debt to GDP ratio driven by sound fiscal performance
is the other key driver of the positive outlook. In this regard, Fitch also
acknowledges that the government guarantees are on a clear downward trend.

“I am
pleased to note that Fitch has acknowledged our policies to sustain growth by
diversifying the Maltese economy as well as our sound and prudent management of
public finance. More importantly, Fitch accepts the government resolve to
continue upholding its fiscal rules targeting a balanced budget in structural
terms (net if IIP receipts) and ensuring that expenditure growth does not
exceed the economy’s potential growth rate,” commented Minister for
Finance Edward Scicluna.

Fitch
expects Malta to continue upholding its fiscal rules targeting a balanced
budget in structural terms and ensuring that expenditure growth does not exceed
the economy’s potential growth rate.

Despite the
strong economic growth enjoyed by the Maltese economy, Fitch notes that there
has been little evidence of overheating. Indeed, it forecasts inflation to
remain below the 2 per cent threshold this year and the next.

Fitch
acknowledges recent efforts to strengthen supervisory and regulatory
institutions. Indeed, it commends the recent increase in the FIAU and MFSA
budget, as well as the new supervisory procedures introduced in July.

The credit
rating agency also notes that financial soundness indicators are strong and
improving.

On the
external side, the credit rating report expects Malta’s current account balance
to remain in surplus despite the eurozone slowdown.

The post Fitch affirms Malta’s ‘A+’ rating with a positive outlook appeared first on maltawinds.com.

Original article found on Malta Winds

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