Irish credit rating back to A status

A leading &credit ratings agency has restored Ireland’s A rating, a move which will significantly help the country’s borrowing costs.

Standard & Poor’s said there is a one-in-three possibility of a further upgrade in the next two years if the Government reduces the budget deficit below 3%.

The upgrade &underpins Ireland’s improved borrowing costs. During the week, the price of Irish sovereign debt was cheaper than US government treasuries for the first time since 2007.

Prior to the financial crisis wreaking havoc with the economy, Ireland had the highest credit rating available with all three of the major agencies.

But the implosion of the property bubble and the collapse of the banking system presaged a series of downgrades that culminated in Moody’s lowering Ireland to junk status in July 2011.

& Standard & Poor’s yesterday became the first to upgrade this country from BBB+ to A- with a positive outlook.

The agency cited the brightening prospects for the domestic economy; the falling cost of government debt; and the slow return of the banking system to health as reasons for the upgrade.

Finance Minister Michael Noonan welcomed the upgrade. He said that “&&with thousands of jobs being created each month, strong exchequer performance, and with positive high-frequency indicators, I am confident that we are moving in the right direction”.