Moody’s last assessment of Portuguese sovereign debt was in November last year, when it raised the rating from ‘Baa2’ to ‘A3’.

In a note published on its website, Moody's considers that Portugal's rating is supported by “its competitive and diversified economy, relatively high levels of wealth and high institutional strength” and that, since the last assessment, the evolution of the country “has been globally consistent with the agency’s expectations.”

The agency projects growth in the Portuguese economy of 1.8% in 2024 and 1.9% in 2025, also noting that, despite the reduction recorded, the ratio of public debt to Gross Domestic Product (GDP) still remains high.

According to Moody’s, the stable outlook reflects the opinion “that the risks to Portugal’s credit profile at the ‘A3’ rating level are balanced”.

“More positive trends in economic and fiscal strength than Moody's currently expects are offset by recent evidence of political risks”.

For Moody’s, “the early elections in March 2024 did not result in a clear government majority and the risks of new early elections at the end of 2024 are high”.

Among the other main agencies, Standard & Poor's assesses Portuguese sovereign debt at 'A-', with a positive outlook, Fitch at 'A-', with a 'stable' outlook, and DBRS at 'A', with a 'stable' outlook.

The next financial rating agency to comment on Portugal will be DBRS on July 19th.