Fitch confirms Poland’s credit rating

The credit rating agency Fitch has confirmed the long-term rating of Poland in foreign currency at 'A-' with a stable outlook. The decision falls in line with the assessments with other major credit rating agencies such as Moody's and S&P, which all deem Poland’s economy to be robust and able to withstand potential shocks on the global financial market.

According to Fitch, Poland's rating is a result of its diversified economy, stable economic growth for a consecutive number of years and a sound macroeconomic framework.

"The Stable Outlook reflects the resilience of Poland's economy to the coronavirus shock, an expected boost to medium-term growth from next generation EU (NGEU) funds and our expectations that after deteriorating sharply in 2020, the budget deficit and public debt levels will both improve from 2021 as pandemic-support measures are wound down and the economy recovers," the agency said.

The American credit rating agency also raised Poland's GDP growth forecast for 2021, 2022 and 2023. It expects the Polish economy to grow by 5.2 percent this year (4.4 percent previously), by 4.5 percent next year, and by 3.8 percent in 2023.

The agency’s forecasters argue that the country will be one of the big winners of the EU’s coronavirus recovery package known as “Next Generation EU”. According to Fitch, Poland’s recovery plan has not been approved by the EU for political reasons. The agency views it to be a setback that will only delay the transfers of funds, rather than signalling that Poland is in danger of losing its tranche all together.

However, Fitch expects Polan’s general government deficit to stand at 3.8 percent of GDP in 2022, significantly higher than the government's expectation of 2.8 percent. The agency forecasts that the same figure will drop to 3 percent in 2023.

The new assessment is the agency’s first credit rating of Poland since it confirmed its previous rating on March 19th this year.

Among the so-called “Big Three Credit Rating Agencies”, Moody's gives Poland the highest rating, an “A2” while Fitch and S&P rate Poland at an “'A-”. All three agree that the Polish economy has a stable outlook.

S&P will publish its new rating review for Poland on October 1st and Moody's will follow suit by the end of October.