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Outlook for Austria’s government bond rating down to negative

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Staff writer ▼ | October 26, 2015
Country rating   Economic growth in Austria is likely to remain low

The Moody’s rating agency has lowered Austria’s government bond rating outlook from stable to negative, affirming the Austria rating.

"The main driver of Moody's decision to change the outlook to negative from stable is Moody's view that Austria's economic growth is likely to remain low over the medium term, which will pose challenges for a material reduction in Austria's relatively high government debt burden over the remainder of this decade," Moody’s said in a Friday statement.

According to the rating agency, Austria’s real GDP (gross domestic product) has "barely grown" since 2012, but there are some signs that economic growth will pick up in the country next year.

Moody’s said that no major macroeconomic imbalances have been observed in Austria.

"The affirmation of the Austria/P-1 ratings reflects the country's comparatively large and wealthy economy, which benefits from a sizeable, high-value added industrial base."

Moody’s warned, however, that the Austria government bond rating could be downgraded in the coming years if Austria’s economic growth does not pick up.

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