DBRS maintains Portugal’s rating unchanged

The Canadian ratings agency DBRS decided on Friday to keep Portugal’s rating at ‘A’ (High) with a stable outlook.

The agency says it is optimistic about the direction that the Portuguese economy is taking this year, although it warns that it will be “increasingly more difficult” for the government to continue to make small budget surpluses in the medium term.

“The growing pressures on expenditure and the planned tax cuts, as well as higher military spending will put pressure on public finances over the next decade”, states the agency in a note in which it confirms the rating and outlook for Portugal’s sovereign debt.

Nevertheless, the Portuguese public debt ratio, which fell sharply from 116.1% of GDP in 2019 to 94.9% in 2024, is expected to fall to less than 90.0% of GDP in the next two years, “which could put the Portuguese debt ratio below the eurozone average,” DBRS expects.