S&P raises Greece rating by two notches on bailout talks with creditors

ATHENS - Reuters

Standard & Poor’s on July 21 upgraded Greece’s sovereign credit rating by two notches and revised its outlook to stable from negative, citing eurozone countries initial agreement to start negotiations with the country on a third bailout.

S&P raised its rating for Greece to CCC+ from CCC-, saying the country’s liquidity perspective has improved after euro zone finance ministers last week gave their initial consent to a three-year loan program to keep the country in the euro.

“We think opportunities for Greece to default on commercial debt this year are few,” S&P said in a report.
The possibly Greece quit the single currency union was less than 50 percent, it said.

S&P is the first to upgrade Greece after it clinched a last-minute deal with its lenders last week which opened the way for bridge financing that will cover Athens’ funding needs through July and for bailout talks on a third aid package.

Greece’s leftist government urged disgruntled lawmakers on July 22 to back reforms required for talks on a rescue deal to start, as Prime Minister Alexis Tsipras faced his second major test in parliament in a week.

A first set of reforms that focused largely on tax hikes and budget discipline triggered a rebellion in his party last week and passed only thanks to votes from pro-EU opposition parties.

The bill lawmakers due vote on late July 22 to open negotiations on a 86 billion euro rescue loan with the EU.