25 Aug 2012
(MENAFN) Egypt is no longer on Standard & Poor’s watch list, and was affirmed ‘B/B’ rating on its long and short-term foreign and local currency sovereign, although with negative outlook, Reuters reported.
S&P based its decision on the emergence of working relationship between Egypt’s dominant political group and the military.
“B” is a speculative grade rating which indicates that the rated entity is more vulnerable to adverse business, financial and economic conditions but currently has the capacity to meet financial commitments.
S&P said the new relationship between the party and the military could pave the way for an improvement in medium-term policymaking, therefore Egypt’s weak public sector finances and external position could stabilize.
The negative outlook was given to the country’s outlook as there is a one-in-three likelihood of a downgrade is political or social tensions escalate once more, the ratings agency added.
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