An assessment of Portugal’s credit rating was conducted on January 17, where the rating agency upgraded the classification to A (high) but adjusted the outlook from positive to stable.
The Director of Investments at Banco Carregosa, Filipe Silva, stated that “the DBRS is expected to maintain both the rating and the outlook for Portugal,” noting that “the current geopolitical situation may introduce new challenges to economic growth, which are still hard to quantify as agreements regarding tariffs are still being finalized.”
He further commented that “while economic growth projections have been revised downwards, the investment plans in defense and infrastructure announced in Europe could offset and spur growth,” emphasizing the need for “more time to evaluate if Portugal can maintain its trajectory of debt reduction.”
Xtb analyst Vítor Madeira also argued that “though the July 18 review naturally raises questions about a potential change in this assessment based on the latest macroeconomic and market indicators, everything points to maintaining the rating and stable outlook.”
Considering economic indicators and the financial market’s perspective, “the current DBRS assessment appears appropriate, as Portugal continues to demonstrate stable capacity to meet its financial obligations without elements justifying a rating change,” he asserted.
Both Filipe Silva and the Xtb analyst agree that the outlook should remain stable, “reflecting a balance between risks and opportunities.”
This year, both DBRS and S&P upgraded their assessment of Portugal’s sovereign debt in their reviews conducted before the political crisis that led to early elections, while Fitch, Moody’s, and Scope have left Portugal’s rating unchanged.
Credit ratings assess credit risk, significantly affecting financing for countries and companies.
