S&P raises Philippines credit rating

Standard & Poor's raised the Philippines' long-term foreign currency credit rating to within one rung of investment grade on Wednesday, citing the government's improving finances. The US rating outfit assigned the government a "BB+" rating with stable outlook, from "BB" with positive outlook, the agency's credit analyst Agost Benard said in a statement. "The foreign currency rating upgrade reflects our assessment of gradually easing fiscal vulnerability, as the government's fiscal consolidation improves its debt profile and lowers its interest burden," he added. "The rating action also reflects the country's strengthening external position, with remittances and an expanding service export sector continuing to drive current account surpluses." S&P's action put the Philippine government within one step of its bid for investment-grade status, which starts at "BBB-" in the S&P scale. President Benigno Aquino's spokesman Ricky Carandang hailed the upgrade, saying it put the government one step closer to investment grade status. "This is an affirmation of the fiscal management of the Aquino administration," Carandang said in a statement. Finance Secretary Cesar Purisima said the upgrade gave the government confidence it was following the right economic policies. "We can now clearly make our case for an investment grade status," he said in a statement.