Fitch Cuts Poland's Rating Outlook To Stable

(RTTNews) - Fitch Ratings downgraded Poland's credit rating outlook on Friday, citing a projected rise in budget deficit and upward revision to debt forecast.

The credit rating was affirmed at 'A-', the fourth lowest investment level, while the outlook was lowered to stable from positive. The agency last upgraded its outlook on Poland to positive in February.

The rating agency forecast a budget deficit of 4.2 percent of GDP this year, which was 0.7 percentage point higher than the government's estimate. Moreover, the agency said the deficit will not fall below 3 percent until 2015.

Due to the revision in deficit forecast, gross general government debt is expected to peak only at around 56 percent of GDP in 2013-14 rather than in 2011.

Further, Fitch said the suspension of Poland's first legal public debt threshold, which is set at 50 percent of GDP, has reduced the credibility of nation's rule-based fiscal framework.