Bahrain’s Sovereign Ratings Affirmed
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Summary
Ref : BH21CRA00-01 9 April 202 1
Bahrain’s Sovereign Ratings Affirmed
Rating Action
Capital Intelligence Ratings (CI Ratings or CI) today announced that it has affirmed Bahrain’s Long-Term Foreign Currency Rating (LT FCR) and Long-Term Local Currency Rating (LT LCR) at ‘BB – ’. At the same time, CI Ratings has affirmed the sovereign’s Short -Term Foreign Currency Rating (ST FCR) and Short-Term Local Currency Rating (ST LCR) at ‘B’. The Outlook for all ratings remains Negative.
Rating Rationale
The ratings and o utlook reflect the declining level of already modest official foreign exchange reserves, a s well as the continued drawdown o f the sovereign’s stock of other external assets to cover its financing needs. The ratings also reflect the economic fallout from Covid-19 and relatively low hydrocarbon prices, which have contributed to weakening fiscal and external balances and increasing debt…