Moody’s upgrades Mongolia’s issuer ratings from negative to stable www.news.mn
Moody’s Investors Service has changed the outlook on the Mongolian government’s issuer ratings from negative to stable, and affirmed the long-term B3 issuer, local media reported on Wednesday.
The decision to change the rating outlook to stable reflects Moody’s view that liquidity risks and external pressures have stabilized for the foreseeable future, albeit at somewhat higher levels than seen prior to the COVID-19 pandemic, Moody’s said in a statement.
External vulnerabilities have declined, on the back of a faster than expected recovery in mining exports, that Moody’s expects to continue.
The affirmation of the B3 rating reflects Mongolia’s existing credit challenges, including long-standing external and liquidity risks, as well as fiscal weaknesses that have increased due to the pandemic, the credit rating agency said.
In 2021, stronger growth in both Mongolia’s exports and imports will result in wider current account deficits relative to 2020, although Moody’s estimated that deficits in the next four years will narrow to nearly half of the pre-pandemic averages.
A steady recovery in China, Mongolia’s largest export market, will continue to support overall demand for commodities, according to the agency.
Published Date:2021-03-23