Italy, DBRS confirmed the sovereign rating A (low), negative outlook – Reuters Italy

Italy, DBRS confirmed the sovereign rating A (low), negative outlook – Reuters Italy

       

MILAN (Reuters) – The agency DBRS has once again confirmed the long-term sovereign credit ratings of Italy to A (low), with outlook remains ‘negative’.

       

The announcement is contained in a note, explaining that “the rating confirmation reflects the progress in fiscal consolidation in Italy, as evidenced by a budgetary position that remains relatively strong and compares favorably with the euro area average. “

       

The agency also confirmed the Italian short-term rating at R-1 (low), with an outlook that remains in this case, ‘stable’.

       

The negative outlook, the statement said, reflects DBRS assessment of the risks from fragile economic outlook – with a recovery that “slow to materialize” – and the large debt.

       

“With the current growth estimates, the dynamics of Italian debt remains a concern,” writes DBRS, explaining that the margins of the budget for the country appear to be “heavily constrained.”

        
       

GOOD INTENTIONS, THE RESULTS NOW

       

On the political front DBRS recognizes the acceleration Renzi imposed by the government on the issue of reform but believes that, despite the government’s intentions are defined as “encouraging”, the risks related to the implementation of these initiatives remain “significant.”

       

“There was definitely a change of pace on reform, but clearly we expect that these good intentions of the government are translated into more concrete actions,” says the head of sovereign analyst for Italy Giacomo Barisone, which indicates, as a priority for the government’s commitment to the rationalization of public spending and reforms needed to recover competitiveness, first of all, that of the labor market. Read more …