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"Moody's" reaffirmed the "Ba3" sovereign rating of RA, changing the outlook from "negative" to "stable"
On June 22, 2023, "Moody's" rating agency reaffirmed Armenia's "Ba3" sovereign rating, changing the outlook from "negative" to "stable." The revision of the rating outlook is based on the agency's assessment that Armenia's economic and fiscal prospects have improved and risks are balanced compared to the predominance of downside risks at the time of the previous rating assignment (March 2022).
According to the rating agency's assessment, Armenia's economic and fiscal indicators improved significantly last year due to the increase in capital and labor inflows, some of which are expected to be maintained. Referring to the double-digit (12.6%) economic growth in 2022, the rating agency predicts that Armenia's economic growth will remain stable in the next few years. In particular, economic growth of around 7% is expected for 2023 and 5-6% for 2024.
In addition, according to the agency's forecasts, fiscal indicators will stabilize at the current level, and the debt burden will be lower than in the pre-pandemic period, stabilizing at the level of 45% in the coming years and contributing to the strengthening of fiscal stability. However, while describing the country's economic and budgetary situation, the rating agency's representatives referred to the geopolitical risks that counterbalance the existing improvements.
