Fitch upgrades Portugal's sovereign rating to A+ as debt ratio falls
Portugal's public accounts have become more balanced, and its debt-to-GDP ratio is on a downward path, prompting Fitch to lift the sovereign rating to A+. The Ministry of Finance noted this is the fourth rating revision in two years, following earlier upgrades by S&P. Economists highlighted the sustained fiscal surplus since 2019, despite a temporary deficit during the pandemic, and warned that future fiscal pressures could arise.
After fifteen years since the Troika intervention, Portugal has moved from a crisis-hit borrower to an A+ rated sovereign, according to Fitch, which cited a stable outlook. The upgrade follows a series of rating actions over the past two years, including two recent upgrades by S&P. The Ministry of Finance emphasized the country's more balanced budgets and a falling public-debt ratio, which have improved financing conditions and external credibility.
Economists such as Ricardo Ferraz pointed to the shift from double-digit deficits to fiscal surpluses in 2019, with only a pandemic-related dip thereafter, and noted the continued trend of debt reduction. However, scholars like António Mendonça and José Reis cautioned that the rating reflects short-term market confidence and that structural vulnerabilities remain, with the Banco de Portugal projecting a rise in debt-to-GDP after the early 2030s.
