S&P lifts Honduras to positive

S&P said it revised the outlook on the Republic of Honduras to positive from stable.

The agency also said it affirmed the B+ long-term and B short-term sovereign credit ratings on Honduras.

S&P also said it affirmed the BB- transfer and convertibility assessment.

The outlook revision reflects that sustained fiscal improvement and favorable economic growth could improve the country’s fiscal flexibility over the next two years, the agency said.

Successful adherence to the benchmarks outlined by Honduras' three-year program with the International Monetary Fund –combined with continued GDP growth – could strengthen public finances by helping to contain the expected annual increase in government debt, S&P said.

The ratings reflect the country’s weak political institutions, low income economy and exchange rate rigidities that constrain monetary policy, the agency added.

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