LISBON, Feb. 8 (Xinhua) -- The Moody's ratings agency expects to return Portuguese debt to investment grade in April, a spokesman said on Thursday.
Evan Wohlmann, a vice-president of Moody's, was addressing investors, businessman and local media at a banking conference in Lisbon. He said Portugal appeared to have entered a new cycle of lower borrowing costs.
Wohlmann praised Portugal's reduced deficit and increased investment, while emphasizing the role played by the quantitative easing program of the European Central Bank (ECB). No European Union (EU) country other than Ireland has benefited from quantitative easing more than Portugal, according to Wohlmann.
The initiative has seen the ECB persistently buy debt issued by EU countries, ensuring high demand and lower yields.
Moody's is now expected to lift Portugal out of its junk grade bracket when it makes its next credit rating announcement on April 20.
Moody's upgraded Portugal's outlook from stable to positive in September 2017, but maintained a Ba1 rating, one below investment grade.
Shortly after Moody's verdict, Standard & Poor's returned Portugal to investment grade status, and Fitch followed suit in December.
Moody's is thus the only one of the the big three ratings agencies to still rank Portuguese debt as junk.
Some institutional investors can only buy sovereign debt rated investment grade by all three agencies. An upgrade from Moody's would thus widen Portugal's investor pool considerably and bring borrowing costs down.
