Moody's: Negative view for Latvia

The Latvian government's Baa3 ratings and negative outlook reflect the impact of the severe economic recession and uncertainties around Latvia's economic and financial outlook, Moody's Investors Service said in a new report.

The ratings also take into account demonstrated financial support from the European Union, International Monetary Fund and neighboring countries, the agency said.

Latvia's economy and government finances are now beginning to stabilize after being severely affected by the global financial crisis in 2009, the agency said.

The strengthening regional economy is supporting Latvian production and exports, while the sharp swing in the current account balance suggests that the country's internal devaluation is working, Moody's added.

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