The financial rating agency Fitch upgraded Portugal's rating from A to A+, placing the country on par with France and Belgium. With this upgrade, Portugal is now only behind six Eurozone countries in terms of rating: Germany, the Netherlands, Luxembourg, Austria, Finland and Ireland. Fitch highlighted the reduction in public debt, the improvement in fiscal balances and economic growth as determining factors for this decision.
The Minister of Finance, Joaquim Miranda Sarmento, classified the upgrade as "another great victory for Portugal", noting that it occurred "in a geopolitical and economic context still marked by uncertainty and instability". The five largest Portuguese banks - Caixa Geral de Depósitos, BCP, Novobanco, Santander Totta and BPI - issued statements welcoming the decision.
The bankers are unanimous in considering that the upgrade represents a recognition of fiscal consolidation and the country's economic performance. Paulo Macedo, CEO of CGD, stated that the decision "confirms the strengthening of the country's financial credibility", while Miguel Maya, from BCP, attributed the upgrade to the consistent performance of Portuguese entrepreneurs. Isabel Guerreiro, from Santander Totta, highlighted that the improvement allows for reducing financing costs for the State, companies and families.
The Investment Director of Banco Carregosa, Filipe Silva, put the decision in perspective, noting that "a significant part of the benefit will already be reflected in the current levels of Portuguese debt yields". According to Filipe Silva, the move from A to A+ is not as transformative as an upgrade from BBB to A, although it may attract new institutional investors subject to formal rating restrictions.
