Moody's: Morocco view negative

Moody's Investors Service said it changed the outlook on Morocco's Ba1 government bond rating to negative from stable.

The Ba1 rating itself remains unchanged.

Moody's said the main driver for the change is the significant deterioration in the government's fiscal metrics, as reflected in rising budget deficits since 2011. This is due to the country's decision to increase public-sector wages and let the subsidy bill rise in response to rising oil prices so as to maintain social peace. Moody's expects the deficit to have remained significant in 2012. As a consequence, the public debt ratio, which had been on a declining path until 2009, is now increasing again.

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