MEXICO: Fitch Raises BBB+ Rating Outlook From Negative To Stable

(RTTNews) - Fitch Ratings affirmed Mexico's credit rating at 'BBB+' and raised its outlook to 'stable,' from 'negative,' citing reduced downside risks to the country's growth outlook and expected stabilization of the public debt burden.

"The risk of a disruptive scenario that could undermine Mexico's export competitiveness and hurt potential growth or jeopardize overseas remittance flows are diminishing," said Fitch in a statement.

According to the credit rating agency, the United States appears to be taking a more moderate stance regarding the North American Free Trade Agreement (NAFTA) renegotiation, which contributes to reducing risks to Mexico. Fitch considers that a future reformulation in the agreement should not impede Mexico's access to the US market.

However, "the political cycles in both Mexico and the United States impose tight deadlines on both administrations, which could complicate discussions and the approval process in respective congresses in a timely manner. A prolonged period of uncertainty could weigh on investment decisions and dampen near-term recovery prospects," Fitch said.

The Mexican economy, according to the rating agency, is showing resilience to the lower oil prices abroad and the risks of protectionism in the United States. Fitch expects that the country will grow 2% this year and 2.4% on average between 2018 and 2019.