UPDATE: Moody's changes Poland's outlook to negative from stable, affirms A2 ratings
Moody's Ratings has changed Poland's outlook to negative from stable, affirmed A2 long-term senior unsecured and issuer ratings, the rating agency said in a statement.
"Our decision to change the outlook to negative reflects a materially weaker outlook for fiscal and debt metrics compared to our earlier expectations. If the government is unable to address spending pressure and hurdles to raise revenue, it would denote weaker fiscal strength and policy effectiveness compared to our current assessment", the agency said.
"The main downside risks to our updated fiscal and debt outlook stem from the standoff between the government and the President, and the likelihood of increased government spending ahead of the 2027 parliamentary election and beyond", it added.
As stated, the affirmation of Poland's A2 ratings is supported by the country's high economic strength, with trend real GDP growth of almost 3 percent and ongoing income convergence towards the EU average.
"Moreover, Poland's credit profile benefits from a still moderate public debt burden in combination with robust debt affordability metrics. That said, Poland's A2 ratings also take into account elevated geopolitical risks in the context of Russia's war against Ukraine (Ca stable)", the agency said.
pel/