Iceland’s Credit Rating Improves Skip to content

Iceland’s Credit Rating Improves

Standard & Poor’s has raised the long-term credit rating of the Icelandic government, from BBB- to BBB.

Iceland’s short-term rating was then raised from A-3 to A-2, the second best rating possible.

The government’s long-term rating can however still improve by three further levels—A, AA and AAA.

According to a press release from the company, the change is principally based on the recently announced relaxation of capital controls, which analysts at S&P expect “will be beneficial for investor sentiment and improve access to foreign capital markets for nonsovereign issuers.”

On Standard & Poor’s website, a BBB rating is defined thus:

“An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.”

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