S&P ups Prague outlook to positive

Standard & Poor's said it revised its outlook on the Czech city of Prague to positive from stable following the outlook revision on the Czech Republic to positive. S&P also affirmed the city's A- long-term and A-2 short-term issuer credit ratings, A- senior unsecured debt rating and A-2 short-term debt rating.

Prague is the country's capital and economic center, contributing more than 20% of Czech GDP and accounting for 11.5% of the Czech population. The city is expected to benefit from an increase in revenues as a result of the improvement in the country's economic and fiscal outlook, the agency said.

The ratings on Prague reflect its wealthy and diversified economy, strong liquidity position and sound financial performance.

These factors are partially offset, however, by the city's limited revenue flexibility, potential expenditure pressures, expected debt growth and moderate contingent liabilities, the agency said.

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