Credit rating agency Rating<\/b> Fitch<\/b> has affirmed the credit rating of Greece<\/b> at BBB+ with a stable outlook.<\/p>\n
Fitch had upgraded Greece last November within the investment grade.<\/b><\/p>\n
In its statement, the agency said its rating is based on Greece’s higher level of per capita income<\/b> relative to the average country at the BBB grade and governance indicators that are slightly above it, as well as a reliable policy framework<\/b> that is supported by membership of the EU and eurozone.<\/b><\/p>\n
“The fiscal and macroeconomic adjustment has accelerated <\/b>in recent years, strengthening fundamentals and policy credibility.<\/b>These advantages are balanced against the consequences of the sovereign debt crisis, in particular the very high but steadily declining public debt burden, the significant loss of GDP,<\/b> the persistent external imbalances and the potential liabilities of the banking sector,” Fitch said.<\/p>\nMajor factors affecting the rating<\/h2>\n
-strong economic growth: <\/b>The Greek economy’s growth has remained stable at levels slightly above 2% over 2023-2025, despite various geopolitical and trade shocks.<\/p>\n
“We forecast slightly lower growth in 2026, mainly due to the negative impact of the war in the Middle East, but the economy will benefit from the final year of the EU’s Next Generation EU investment programme. Over the medium term, we expect incomes to gradually converge with other euro area countries, based on an estimated potential growth rate of 2%. Domestic demand will remain the key driver of growth, supported by gradually improving household balance sheets, solid employment growth and higher investment,” Fitch notes.<\/p>\n
Significant budget surpluses: <\/b>Greece has achieved surpluses in its 2024 and 2025 budgets, an excellent fiscal performance compared with other countries in the BBB and eurozone member countries.<\/p>\n
The current average deficit of BBB-rated countries stands at 3.1% of GDP, while the overall eurozone deficit stands at 2.9% of GDP in 2025. The strong fiscal performance was supported by structurally higher revenues due to improved tax collection and tight expenditure control.<\/p>\n
“We forecast a smaller fiscal surplus in 2026, due to some fiscal easing, including temporary and mainly targeted support measures from the energy crisis. We do not expect the government to implement large fiscal easing before the elections, despite the significant fiscal space.”<\/p>\n
-Consistent and credible fiscal framework:<\/b>Recent fiscal outcomes and plans for the 2026 budget underscore the government’s strong commitment to fiscal prudence.<\/p>\n
“We find this commitment highly credible, as it has set a strong precedent in the post-panic period and is underpinned by a broad social consensus for sound fiscal policies.”<\/p>\n
“We believe that the government’s commitment to fiscal prudence is particularly credible, as it has set a strong precedent in the post-panic period and is underpinned by a broad social consensus for sound fiscal policies. In July 2025, Parliament overwhelmingly approved a domestic fiscal rule that makes a balanced primary fiscal position mandatory.”<\/p>\n
–Debt Reduction: <\/b>The general government gross debt-to-GDP ratio declined by almost 20 percentage points in 2024 and 2025, falling to 146 percent of GDP, due to resilient economic growth and budget surpluses. However, it is still 2.5 times higher than the median for BBB-rated countries, which is 58%. <\/p>\n
“We expect debt to continue to decline rapidly over the medium term, approaching 120% by 2030 in our baseline scenario, supported by solid nominal GDP growth and significant primary surpluses after 2027. Cash cushions remain at record high levels, allowing early repayment of bilateral bonds and covering maturing debt over the next three years.”<\/p>\n
Low Funding Risks: <\/b>Greece’s favorable debt profile, with an average maturity of 19 years and favorable interest rates, as well as very large cash reserves, significantly reduce market risks and act as a cushion against potential shocks from bond market volatility. The underlying growth rate and interest rate differential is favourable, with the average debt interest rate at around 1.5%, well below the estimated 4% nominal GDP growth rate.<\/p>\n
-Large and persistent current account deficit:<\/b>The large current account deficit narrowed in 2025, but high energy prices will lead to a widening this year. The average current account deficit from 2023 onwards is about 6% of GDP, significantly higher than the current average of 0.2% for BBB-rated countries. Structurally, the low savings rate is the main reason for the significant current account deficit, with import-intensive investment expected to intensify pressure over the medium term.<\/p>\n
“Eurozone membership mitigates external financial risks and we do not expect any disruption to external capital flows,” Fitch said.<\/p>\n
-Supported Banking Sector:<\/b>Fitch upgraded the ratings of systemically important banks to investment grade in 2025, reflecting improvements in Greece’s operating environment and banks’ credit profiles, including a longer period of sustained profit generation, the completion of most asset resolution processes, the shielding of capital positions and a stable deposit funding base. Fitch expects the banking sector to benefit from resilient economic growth, sustained business growth and a gradual recovery in the retail sector.<\/p>\n
-Bank-Government Relationship:<\/b> One issue that is a relic of the past is the close link between the government and banks due to the large share of deferred tax credits (DTCs) in banks’ capital (41% of core Tier 1 capital). <\/p>\n
DTCs remain a contingent liability for the government that does not exist in other eurozone countries, despite recent plans by banks to accelerate their amortisation, which will help normalise their capital structures. <\/p>\n
In addition, government guarantees for bonds under the Hercules programme, aimed at accelerating the reduction of non-performing loans in the banking system, amounted to about \u20ac18 billion or 8 percent of GDP at the end of 2025.<\/p>\n","protected":false},"excerpt":{"rendered":"
Fitch has affirmed Greece’s credit rating at BBB+ with a stable outlook.
\nFitch had upgraded the …<\/p><\/p>\n","protected":false},"author":1,"featured_media":4726,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7],"tags":[],"class_list":["post-4725","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy"],"acf":[],"_links":{"self":[{"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/posts\/4725","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4725"}],"version-history":[{"count":0,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/posts\/4725\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/media\/4726"}],"wp:attachment":[{"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4725"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4725"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4725"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}