Fitch Ratings on Thursday lowered its outlook for the Philippines’ “BBB” investment-grade credit rating from positive to stable because of the impact of the coronavirus disease 2019 (Covid-19) pandemic on the country’s economy. Fitch forecasts the economy to contract by 1 percent this year after expanding by 6 percent in 2019. If correct, the projection would settle below the government’s revised growth assumption of -0.8 to zero percent for 2020. Fitch also sees the government’s fiscal relief measures to contribute to a widening of the 2020 general government deficit by more than 3.5 percentage points of the country’s gross domestic product (GDP). The credit rater also affirmed the Philippines’ “BBB” rating, which reflects the country’s fiscal and external buffers, including its lower government debt/GDP ratio, compared with peer medians and net external creditor position, as well as its still-strong medium-term growth prospects.

Source: Manila Times May 07, 2020 16:32 UTC