Written by Michael Moon
Standard & Poor's upgraded its debt rating for Greece on Friday, up from B minus to B, with a stable outlook for the rating. S&P had an optimistic forecast on Greece's economy, predicting a slow recovery in 2014 after seven years of continuous economic downturn.
"'The outlook is stable, balancing our view of Greece's progress in fiscal consolidation against its still-weak economic recovery and political resolve to continue with structural and institutional reforms,' said S&P in a news release on Friday."
As a credit-rating agency (CRA), S&P provides credit ratings for the debt of private and public companies as well as governments and government entities. According to their website, their credit ratings "express the agency's opinion about the ability and willingness of an issuer, such as a corporation or state or city government, to meet its financial obligations in full and on time." Greece's current long-term sovereign credit rating of B indicates "more vulnerable to adverse business, financial and economic conditions but currently has the capacity to meet financial commitments."
Greece was one of the many countries involved in the aftermath of the 2008 financial crisis. In 2010, Greece received a "junk" rating on its debt and subsequently became locked out of private capital markets. The country then received a bailout from the rest of Europe and the International Monetary Fund totalling 240 billion euros.
Below is Greece's annual GDP growth rate, which shows a possibility of finally crossing the zero mark in the near future.
- Greek debt upgraded to 'B' by S&P; Recovery 'weak' (Katy Barnato, CNBC.com, 12 September 2014)
- S&P Upgrades Greece Debt Rating - Update (Michael Calia, nasdaq.com, 12 September 2014)
- Grece Economic Indicators (Trading Economics, 12 September 2014)