What is a credit rating?
It expresses the ability of a country to pay its obligations in the short and long term.
How do agencies measure this capacity?
Credit rating reports measure this by studying and monitoring risks and threats as well as strengths and positives in the economic environment.
What are the most important institutions that do this measurement?
Three global institutions monopolise Credit ratings: Moody’s, Fitch and Standard & Poor’s (S&P). The rating is the degree of merit /credit rating with the outlook for this economy.
Why do we consider this report important and unique?
This report is considered the first report in which the outlook has been positive for the previous two years.
What does a positive outlook mean?
A positive outlook means that this country has great chances of being rated higher in future reports.
Details of previous reports:
The last report in which the institution announced its positive view of the Egyptian economy was in May 2015. In November 2015, the outlook regressed to stable from positive due to the risks and disadvantages expected from the fall of the Russian plane.
In the May 2016 report, the outlook dropped from stable to negative due to the shortage of foreign currency in Egypt.
The November 2016 report came in the same month as the exchange rate was revised to avert the outlook to stable due to the launch of reforms. Finally, the November 2017 report was released and the outlook shifted from stable to positive, one year after the Liberalisation of the exchange rate to give the green light to a more prosperous future and a stronger economy with the success of the reforms.
