Fitch Ratings has revised Italy's Outlook to Stable
from Negative. At the same time the agency has affirmed Italy's Long-term
foreign and local currency Issuer Default Ratings (IDRs) at 'BBB+'. The issue
ratings on Italy's senior unsecured foreign and local currency bonds were also
affirmed at 'BBB+'.
The Country Ceiling has been affirmed at 'AA+' and the Short-term foreign currency IDR at 'F2'.
Fitch has also revised its outlook on the Italian insurance market from negative to stable following stronger-than-expected first-half results from Italian insurers.
The change also reflects Fitch's expectation that Italian insurers' profit and capital adequacy will be resilient despite the country dipping back into recession.
GGGD will peak at 135% of GDP in 2014, marginally higher than Fitch's previous forecast (133% of GDP), due to weaker nominal GDP growth. Fitch expects GGGD to decline slowly and remain above 130% of GDP until 2017, compared with the 'BBB' median of 40%. The high debt leaves very limited fiscal space to respond to any adverse shock.
The new government of Matteo Renzi announced a structural reform agenda with an ambitious timetable and confirmed in the 2014 Stability Programme the previous governments' commitment to the eurozone fiscal framework, in particular, keeping deficit below 3% of GDP in 2014 and maintaining the medium-term fiscal consolidation path.
EU-Digest
The Country Ceiling has been affirmed at 'AA+' and the Short-term foreign currency IDR at 'F2'.
Fitch has also revised its outlook on the Italian insurance market from negative to stable following stronger-than-expected first-half results from Italian insurers.
The change also reflects Fitch's expectation that Italian insurers' profit and capital adequacy will be resilient despite the country dipping back into recession.
GGGD will peak at 135% of GDP in 2014, marginally higher than Fitch's previous forecast (133% of GDP), due to weaker nominal GDP growth. Fitch expects GGGD to decline slowly and remain above 130% of GDP until 2017, compared with the 'BBB' median of 40%. The high debt leaves very limited fiscal space to respond to any adverse shock.
The new government of Matteo Renzi announced a structural reform agenda with an ambitious timetable and confirmed in the 2014 Stability Programme the previous governments' commitment to the eurozone fiscal framework, in particular, keeping deficit below 3% of GDP in 2014 and maintaining the medium-term fiscal consolidation path.
EU-Digest
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