S&P lifts Portugal

S&P said it raised its unsolicited long-term foreign- and local-currency sovereign credit ratings on Portugal to BBB+ from BBB.

“The upgrade reflects the resilience of Portugal's economy, public finances, and largely foreign-owned financial sector to various external shocks, including the fallout from the war in Ukraine. We expect Portugal to post a primary budget surplus (excluding interest payments) in 2022, following its track record of primary surpluses prior to the pandemic. We believe that strong tax collection during 2022, boosted by higher growth and inflation and the government's caution on expenditure, will bring Portugal's deficit below its target of 1.9% of GDP in 2022 and to balance in 2025,” the agency said in a press release.

The outlook is stable.

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