DBRS upgrades Uruguay

DBRS said it upgraded the Oriental Republic of Uruguay’s long-term foreign- and local-currency issuer ratings to BBB and revised the trend to positive from stable.

“The upgrade to BBB reflects DBRS Morningstar’s assessment that Uruguay’s fiscal outlook has materially improved due to fiscal consolidation efforts and institutional improvements to the budgetary framework. The headline central government deficit (excluding the ‘cincuentones’ pension transfers) narrowed from 5.8% of GDP in 2020 to 4.3% in 2021 and is expected to decline to 3.1% in 2022. The government forecasts the deficit to narrow to 2.1% of GDP in 2026, which should be sufficient to stabilize government debt ratios,” the agency said in a press release.

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