Sri Lanka’s sovereign rating outlook was raised to positive from stable by Moody’s Investors Service, which cited a “peace dividend” of greater economic and financial stability.
Sri Lanka’s improved credit assessment comes as the island plans to raise $1 billion from the sale of dollar-denominated bonds in its fourth international offering. The nation’s foreign-currency rating remains at B1, four levels below investment grade. Standard & Poor’s upgraded the island’s credit rating by one level to B+ on Sept. 14.
The country may be able to attract more foreign funds and lower its borrowing costs, further bolstering economic growth after the end of a three-decade civil war against separatist Tamil Tiger rebels. The risk premium on emerging-market debt has shrunk to 3.14 percentage points from 8.91 points during the global financial crisis, according to an index compiled by JPMorgan Chase & Co. (JPM)
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