Fitch revises up Philippines outlook to 'positive'

Fitch Ratings revised its outlook on the Philippines to "positive" from "stable", saying governance standards and competitiveness indicators have shown steady improvement under President Benigno Aquino. Fitch affirmed its rating on the Philippines as 'BBB-', the minimum investment grade rating. A revision in outlook to positive is often followed by an upgrade in credit ratings. Fitch said factors that might lead to a "positive rating action" for the Philippines are sustained improvements in governance standards after a new administration is elected in May 2016, continued strong growth without signs of imbalances and a broader state revenue base.
"Indicators for corruption, transparency and economic freedom have also improved substantially. Evidence that governance improvements can be sustained beyond the next election cycle would be positive for the credit," Fitch said. Amando Tetangco, Bangko Sentral ng Pilipinas governor, said the Fitch statement "signals the long overdue credit rating upgrade, which appropriately reflects the economy's outperformance". He added that the country's strong fundamentals entice short- and long-term capital "once markets see through the temporary noise".