Moody's has upgraded the government of Iceland's government debt ratings to Baa2 from Baa3.
Moody‘s announced this yesterday. The rating outlook is stable.
According to Moody‘s press release the upgrade reflects the following key drivers:
1. The initiation of a careful process of capital account liberalization that is expected to reduce the country's
external vulnerabilities, while protecting economic and financial stability;
2. Expectation of further improvement in the government's gross and net debt position over the next three to four
years, thanks to robust growth, further fiscal consolidation and debt pre-payments;
3. Improvements to macro-prudential and micro-prudential regulation designed to preserve the stability of Iceland's
financial system in the future.
In a related decision, Moody's raised Iceland's country ceilings for long- and short-term foreign currency debt and deposits to Baa2/P-2 from Baa3/P-3, and its country ceilings for local currency debt and deposits to Baa1 from