Fitch revises Slovakia view to negative

Fitch Ratings said it revised the outlook on Slovakia’s long-term foreign-currency issuer default rating to negative from stable and affirmed the IDR at A.

The outlook revision considers revenue losses associated with the slump in growth, that combined with stimulus measures, will lead to a larger and more prolonged widening of the budget gap than previously expected, Fitch said.

“As of end-September, Covid-19-related expenditure measures amounted to 2% of Fitch-projected 2020 GDP, while revenue measures amounted to 1% of GDP. However, the government has revised its 2020 fiscal deficit target to 9.7% from 6% in anticipation of a larger economic contraction and possible expansion of labor and other support measures,” Fitch said in a press release.

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