Moody's rates Lithuania bonds Baa1

Moody's Investors Service said it will assign a Baa1 rating to the Government of Lithuania's U.S. dollar-denominated global bond maturing in 2015.

The outlook is negative.

Moody's recently downgraded Lithuania's local and foreign currency bond ratings on Sept. 28 to Baa1 from A3 in response to the severe recession and worsening fiscal prospects.

"Public debt ratios are likely to rise significantly due to the weak economic outlook and higher budget deficits," said Kenneth Orchard, vice-president/senior analyst in Moody's Sovereign Risk Group, in a news release. "The deterioration in the government's credit metrics over the next few years is more consistent with a rating in the 'Baa' range."

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