Saudi Arabia’s outlook was cut to negative from stable by Fitch Ratings as the coronavirus pandemic and lower oil prices clobber the kingdom’s finances.
A negative outlook means the next move on the credit rating may be a downgrade to the lowest level since Fitch began assessing the kingdom in 2004. The sovereign is still at A, its sixth highest rating, and on par with Japan and Iceland, according to a statement on Monday.
Fitch last downgraded Saudi Arabia in 2019 and has its assessment one notch above S&P Global Ratings and one level lower than Moody’s Investors Service.
The revision for Saudi Arabia “reflects the continued weakening of its fiscal and external balance sheets” that’s been “accelerated by the coronavirus pandemic and lower oil prices, despite the government’s strong commitment to fiscal consolidation,” said Fitch analysts including Krisjanis Krustins.
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