Moody's hikes Philippine credit outlook
MANILA, Jan 6, 2011 (AFP) – Moody's Investors Services on Thursday raised the Philippines' sovereign credit outlook from "stable" to "positive", reflecting improved economic prospects under President Benigno Aquino.
"An increasingly strong external payments position and well-anchored inflation expectations have provided the new government an advantageous position from which to pursue its reform agenda," Moody's said in a statement.
The landslide election of Aquino in May last year had "added further momentum" to economic growth by boosting consumer confidence and foreign investment, the Moody's statement said.
It also praised the Aquino government for helping keep the deficit under control during its first six months in office.
The ratings agency's lead sovereign analyst for the Philippines, Christian de Guzman, said the upgrade was due to the country's rising foreign exchange reserves, partly resulting from increased remittances by Filipinos working overseas.
More money from service exports, such as the booming business process outsourcing sector, and capital inflows also contributed to the increasing reserves, according to de Guzman.
However Moody's said it would still be closely watching the government's fiscal management and its implementation of Aquino's "public-private partnerships" effort to finance crucial infrastructure projects.
The new Moody's rating came after Standard and Poor's gave the Philippines an upgrade in November from "BB-" to "BB", which Aquino hailed as a sign the country was emerging from the economic doldrums.
Aquino's spokesman, Ricky Carandang, said the Moody's upgrade would hopefully be similarly followed soon by an actual hike in the country's credit rating.
"We look forward to an actual ratings upgrade in the near future," he said.
"An increasingly strong external payments position and well-anchored inflation expectations have provided the new government an advantageous position from which to pursue its reform agenda," Moody's said in a statement.
The landslide election of Aquino in May last year had "added further momentum" to economic growth by boosting consumer confidence and foreign investment, the Moody's statement said.
It also praised the Aquino government for helping keep the deficit under control during its first six months in office.
The ratings agency's lead sovereign analyst for the Philippines, Christian de Guzman, said the upgrade was due to the country's rising foreign exchange reserves, partly resulting from increased remittances by Filipinos working overseas.
More money from service exports, such as the booming business process outsourcing sector, and capital inflows also contributed to the increasing reserves, according to de Guzman.
However Moody's said it would still be closely watching the government's fiscal management and its implementation of Aquino's "public-private partnerships" effort to finance crucial infrastructure projects.
The new Moody's rating came after Standard and Poor's gave the Philippines an upgrade in November from "BB-" to "BB", which Aquino hailed as a sign the country was emerging from the economic doldrums.
Aquino's spokesman, Ricky Carandang, said the Moody's upgrade would hopefully be similarly followed soon by an actual hike in the country's credit rating.
"We look forward to an actual ratings upgrade in the near future," he said.
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