July 24 Moody's Investor Service raised
Portugal's government bond rating on Friday to "Ba1" from "Ba2",
citing the expectation that the country's fiscal consolidation
remains on track.
Portugal's highest court in May struck down several budget
measures, including some public sector salary cuts, creating a
fiscal gap of about 700 million euros this year.
"The first driver behind the upgrade is Moody's view of the
government's strong commitment to fiscal consolidation, despite
repeated set-backs stemming from the adverse rulings of the
country's Constitutional Court," Moody's said on Friday. (bit.ly/1phcEXF)
Portugal has undertaken several austerity and reform
measures since the European debt crisis that rocked global
The ratings agency assigned a stable outlook to the
government bonds but said that the country's high external debt
was a key credit weakness.
(Reporting By Narottam Medhora in Bangalore; Editing by Joyjeet