DBRS assigns AA (low) to Estonia

DBRS said it assigned long-term foreign and local currency issuer ratings of AA (low) and short-term foreign and local currency issuer ratings of R-1 (middle) to the Republic of Estonia.

The trend is stable.

DBTS said the AA (low) ratings are underpinned by Estonia’s stable macroeconomic policy-making and its exceptionally strong sovereign balance sheet. Credit strength also derives from membership in the European Union and the currency area.

These strengths are offset by Estonia’s small economy and its sensitivity to external shocks, the agency explained. Furthermore, the slower pace of Estonia’s income convergence with the European Union average is symptomatic of structural challenges that have slowed productivity growth.

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