The Japan Credit Rating Agency (JCR) on Friday upgraded Hungaryʼs foreign currency long-term issuer rating to "A-" from "BBB+" with a ʼstableʼ outlook, according to a report by Hungarian news agency MTI.
It also upgraded Hungaryʼs local currency long-term issuer rating to "A" from "A-" with a "stable" outlook.
The foreign currency long-term issuer and the local currency long-term issuer ratings are four and five notches, respectively, over the investment grade threshold.
"The upgraded ratings reflect the countryʼs strengthened economic base resulting from the effective economic policies taken by the government and the central bank, improved public finance brought by a stabilizing revenue base, and shrinking government and external debts in terms of GDP," JCR said.
The rating agency said Hungaryʼs GDP growth rate may return to "a more stable" level of around 3-4% after reaching a "relatively high" pace of around 5%.
Rising inflation "remains contained to some extent" and the impact of wage growth is "partly offset by improving productivity".
Hungaryʼs state debt and external debt levels, relative to GDP, "remain high, but are likely to keep shrinking amid stable economic expansion", JCR said.