Moody's upgrades Ecuador

Moody's Investors Service said it upgraded the Ecuadorian government's bond ratings to Caa2 from Caa3.

The outlook is stable.

The action reflects expectations that the government will continue to secure sufficient external funds to finance its fiscal deficit and improved oil production prospects following the signing of new oil contracts with foreign companies, according to the agency.

The upgrade also affects the country's ceiling for foreign-currency bonds, which has been upgraded to B3 from Caa2, the agency said.

"Ecuador has been able to continue to fund wide fiscal deficits despite fears that the country would face a financing shortfall following its decision to default on Ecuador's global 2012 and global 2030 bonds at the end of 2008," Patrick Esteruelas, a Moody's vice president, said in a statement.

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