Moody’s Upgrades Cuba’s Credit rating, also classfies investment outlook as “Positive” from “Stable”
FINANCIAL TIMES & MIAMI HERALD today reported that Cuba’s Credit rating has been revised upwards by Moody’s Rating Service to a Caa2 rating, as it raised the outlook on Thursday to positive from stable, citing a diversification of trade and financial links after Venezuela cut financial aid. The current rating places Cuba eight steps below investment grade.
“Despite pressure on Cuba’s external finances from lower economic and financial support from its main trade partner, risks remain manageable,” Moody’s analysts Jaime Reusche and Anne Van Praagh said in the statement.
At the same time, more U.S. tourists are visiting Cuba after the Obama administration formally resumed diplomatic relations in July. That prompted Moody’s to boost its forecasts for economic growth to 3.5 percent this year, from a previous estimate of 2.3 percent, Moody’s said. The economy will probably expand 3 percent in 2016, it said. Economists surveyed by Bloomberg expect the U.S. to grow 2.5 percent this year and next.
Moody’s is the only global credit rating company to assign grades to Cuba. Further easing of U.S. restrictions, in place since the 1960s, could lead to an upgrade of the rating, Moody’s said.