NEW YORK, July 9 Fitch on Tuesday upgraded
Latvia further into investment-grade status, citing the
country's invitation to join the euro zone in the coming year.
The agency raised Latvia to BBB-plus from BBB. The outlook
"Euro adoption will enhance economic policy coherence and
credibility compared with the current exchange rate peg to the
euro," Fitch said in a statement.
"The Latvian economy is closely integrated with the EU
through trade, investment and substantial ownership of its
financial sector by Nordic parent banks."
Latvia is ready to become the 18th country using the euro
from the start of next year, the European Commission announced
Standard & Poor's rates the country BBB-plus with a stable
outlook. Moody's rates Latvia Baa2 with a positive outlook.
Latvia underwent one of Europe's toughest austerity programs
after a 2008-2009 crisis wiped a fifth off its GDP.
To adopt the single currency, Latvia reduced its budget
deficit to below the EU ceiling of 3 percent of gross domestic
product last year, cutting it to 1.2 percent.
Its public debt is around 41 percent of GDP, well below the
EU ceiling of 60 percent, and its currency has been pegged to
the euro since it joined the European Union in 2004.