ATHENS – Credit ratings agency Fitch has raised Greece’s rating from ‘BB’ to ‘BB+’, in a report released late Friday.

The upgrade puts Greece one step below the desired investment grade status.

Welcoming the upgrade, Greek Finance Minister Christos Staikouras said that it “confirms that the national goal of reaching investment grade [status] within 2023 -with multiple benefits for society and economy- is achievable.”

This is “the 12th upgrade of Greece’s economy in the last 3.5 years, despite successive external crises,” he added.

In its report, Fitch predicts a further reduction in the country’s deficit to 1.8% of GDP in 2024 from 3.8% predicted for 2022, in part due to the optimization of the Greek government’s temporary support measures. This shows an improvement in the primary balance of 2.5 percentage points, to a surplus of 0.9% in 2024, and a balanced position for Greece in 2023. There is, Fitch notes, some uncertainty about fiscal policies after the upcoming national elections, but risks are mitigated by the broad commitment for fiscal prudence and recent performance in this area, the agency added.

Fitch forecasts a growth rate of 0.9% for the Greek economy in 2023 and 2.3% for 2024, revising its estimates upwards from its last assessment in October 2022, as the balance of risks has improved, it noted, particularly due to the recent reduction in whoselale energy prices, and limited prospects for rationing energy distribution in Europe.