Moody’s: Lithuania outlook to positive

Moody's Investors Service said it changed the outlook on the Baa1 government bond rating of Lithuania to positive from stable.

Concurrently, the agency affirmed Lithuania's Baa1 rating and provisional Prime-2 short-term rating.

Moody’s said the key drivers of the outlook change are: (a) Lithuania's expected accession to the euro area on Jan. 1, 2015, which is set to reduce the country's susceptibility to event risk by eliminating exchange-rate risk and lowering the ratio of general government foreign-currency debt relative to total general government debt; and (b) a continued improvement in the government's balance sheet, expected to result in a 2015 fiscal deficit of 1.3% of GDP, and in general government debt remaining at around 40% of GDP, compared to an EU average of 75%.

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