Philippines close to fourth upgrade

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Investment-Grade-RatingMoody’s Investors Service said in a statement on June 3 that the positive economic development in the Philippines could lead to a rating upgrade for the country to investment grade.

Such an upgrade would be the fourth in a row after Fitch Ratings gave the Philippines its first investment grade rating in March 2013, while Standard & Poor’s followed in May. Japan Credit Rating Agency also hiked its credit score for the Philippines to two notches above investment grade recently.

Moody’s is one of three major global debt watchers which has yet to raise the country’s credit rating to investment grade.

In its statement, Moody’s said the Philippines’ first quarter GDP growth and record budget surplus are “credit positive,” a sign that that an upgrade may be on the cards.

“GDP growth in the Philippines is on an upward trend, in contrast to lackluster global growth performance. On a year-on-year basis, the Philippines’ first-quarter real GDP growth is the strongest among all rated countries in the Asia-Pacific region, outpacing larger emerging markets such as China (Aa3 stable), which had 7.7 per cent growth, and Indonesia (Baa3 stable), which had 6 per cent growth… Such healthy economic conditions will support revenue receipts and debt consolidation,” the statement said.

Officials from Moody’s are expected to arrive in the Philippines next month for a final assessment, and an upgrade could follow suit, analyst said.

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Reading Time: 1 minute

Moody’s Investors Service said in a statement on June 3 that the positive economic development in the Philippines could lead to a rating upgrade for the country to investment grade.

Reading Time: 1 minute

Investment-Grade-RatingMoody’s Investors Service said in a statement on June 3 that the positive economic development in the Philippines could lead to a rating upgrade for the country to investment grade.

Such an upgrade would be the fourth in a row after Fitch Ratings gave the Philippines its first investment grade rating in March 2013, while Standard & Poor’s followed in May. Japan Credit Rating Agency also hiked its credit score for the Philippines to two notches above investment grade recently.

Moody’s is one of three major global debt watchers which has yet to raise the country’s credit rating to investment grade.

In its statement, Moody’s said the Philippines’ first quarter GDP growth and record budget surplus are “credit positive,” a sign that that an upgrade may be on the cards.

“GDP growth in the Philippines is on an upward trend, in contrast to lackluster global growth performance. On a year-on-year basis, the Philippines’ first-quarter real GDP growth is the strongest among all rated countries in the Asia-Pacific region, outpacing larger emerging markets such as China (Aa3 stable), which had 7.7 per cent growth, and Indonesia (Baa3 stable), which had 6 per cent growth… Such healthy economic conditions will support revenue receipts and debt consolidation,” the statement said.

Officials from Moody’s are expected to arrive in the Philippines next month for a final assessment, and an upgrade could follow suit, analyst said.

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