Ratings agency Standard & Poor’s gave investment grade ratings to the Philippines. The Philippine government has been able to increase the assessed financial performance and spur economic growth in the country.
As quoted by Bloomberg, long-term debt rating one notch from the Philippines increased from BB + to BBB-with a stable outlook. While the outlook for Indonesia would be revised from positive to stable BB +.
Philippine Finance Secretary Cesar Purisima said, giving investment grade ratings from S & P to the Philippines is based on the domestic economic outlook. Philippine economy grows due to increase government spending and able to narrow the budget deficit.
On the other hand, local governments can combat corruption quickly. Philippine President Benigno Aquino was considered successful in improving outlook for the domestic economy and succeeded in defeating Indonesia’s debt rating. “We continue to overcome barriers to growth. We continue to build infrastructure and opening up to foreign investors,” said Cesar.
While in Indonesia, the rating agency S & P cut subsidies judge delays fuel oil (BBM), causing the country’s financial deficit swell and reduce the budget for infrastructure.
“For the Philippines, the results of the economic reforms of President Aquino not yet produced results that help improve not only the flow of short-term but also long-term investment,” says economist at Credit Suisse Group AG Santitarn Sathirathai.
The top news, Philippine Stock Exchange rose 1.9 percent to a new record 7230.4. While Composite Stock Price Index (CSPI) in yesterday’s trading, it fell 1.3 percent.
In the last three days, Peso rose 0.2 percent to 40.965 per U.S. dollar. In the past year, the value of an exchange rate with the highest increase after 11 Thai baht and other Asian currencies.
S & P saw an increase in the Philippines rank reflects external reinforcement, moderate inflation and a decline in the government’s dependence on foreign currencies.
In the S & P ratings, Indonesia is stalling economic reforms especially in the country, thus downgraded the debt securities in the year ahead.