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The S&P Ratings has recently announced that it affirmed Germany’s sovereign rating at AAA/A-1 and maintained its outlook at stable.

Key quotes (via Reuters)

  • Stable outlook on Germany reflects expectation of ongoing overall consensus on prudent fiscal and economic policies.
  • Expects Germany to preserve strong budgetary and external positions during 2018-2021 amid solid, albeit moderating growth rates.
  • Foresees Germany’s automotive sector making up for delayed production toward the end of the year.
  • Germany’s large net external creditor position should allow the country to withstand even severe financial & economic shocks.
  • Sees some weakness in Germany’s flagship manufacturing sector this year.
  • Sluggish export growth likely reflecting concerns about rising protectionism but is also related to slower demand in Germany’s export markets.
  • Key risks to the German economy are externally-driven.
  • An external risk to Germany economy is a breakdown in Brexit negotiations  with U.K., which would increase risks to cross-border supply chains.