Fitch upgrades Greece to BBB-

Fitch Ratings said it upgraded Greece's long-term foreign-currency issuer default and senior unsecured ratings to BBB- from BB+.

“Fitch expects general government debt/GDP to remain on a sharp downward trend, thanks to solid nominal growth, budget over-execution and a favorable debt-servicing structure. We also assess policy risks as relatively low, with a stable political backdrop and well-anchored fiscal prudence.

“We forecast the debt ratio will fall to 160.8% this year and 141.2% in 2027 from 171.4% in 2022. The projected 65pp decline in debt ratio from the pandemic high of 205% of GDP is among the best performances of any Fitch-rated sovereigns, although the debt ratio is still forecast to be close to 3x the BBB median,” the agency said in a press release.

Fitch said it now estimates the Greek economy will grow by 2.4% in 2023, a slight upward revision since its last review. “This reflects a better-than-expected performance of consumption in recent quarters and our expectation of continued strong investment performance. We expect growth in 2024-2025 to remain at similar levels (averaging 2.4%), helped by lower inflation, ongoing E.U. Fund absorption and improved economic confidence.”

The outlook is stable.

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