Moody's: Latvia view positive

Moody's Investors Service said it changed the outlook on the Baa3 government ratings of Latvia to positive from stable, citing the ongoing recovery of the economy following its sharp contraction in 2009 and the continuing consolidation of the public finances.

Moody's also said it placed a positive outlook on Latvia's Aa3 ceiling for foreign-currency bonds and its Baa3 ceiling for foreign-currency bank deposits.

The change of outlook is prompted by the country's economic recovery and positive medium-term growth prospects, along with its consolidation of its public finances, Moody's said.

The outlook revision also reflects the company's progress toward meeting the criteria for the country's entry into the euro area, the agency said.

The recent rise in political uncertainty surrounding the president's proposal to dissolve parliament is a concern, Moody's said. But, the agency said it does not expect this turbulence to significantly undermine the economic recovery or the government's broad policy framework.

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