S&P upgrades Ireland's debt rating even in face of Brexit risks

Ireland had its credit score boosted on Friday by S&P Global Ratings, which said the nation’s economy should remain competitive and attractive to foreign investors even if its nearest neighbour, the UK, tumbles out of the European Union without an exit agreement.

“The government has amassed substantial fiscal buffers to offset the risk of an external shock, such as a sudden falloff in corporate tax receipts or a no-deal Brexit,” S&P said in a statement. “Irish growth and employment outcomes continue to rank among the strongest in the developed world.”

The credit assessor lifted Ireland’s rating to AA-, its fourth-highest score, and said the outlook was stable. While underlying domestic economic growth in Ireland has slowed, it is still “significantly” above the average for the euro area and the government remains committed to fiscal prudence, S&P said.

The nation’s economy grew at a pace of 5.8 per cent year-over-year in the second quarter of 2019 and data for the third quarter are due in December. Ireland’s current situation represents a significant turnaround from the depths of the euro-area debt crisis, which saw S&P slash the country’s credit score in 2011 to as low as BBB+, or three notches above junk.