Spanish Prime Minister Pedro Sanchez leaves after giving a press convention through the United Nations 4th International Conference on Financing and Development in Seville, on July 1, 2025.
Cristina Quicler | Afp | Getty Images
Spain’s authorities has obtained one more boost from credit rating companies, with Fitch and Moody’s becoming a member of S&P to boost their respective assessments of the nation.
The hat trick of rating upgrades comes as Spain’s economic system continues to outpace its European peers, with the nation’s authorities and central financial institution just lately upgrading their 2025 progress forecasts.
Fitch on Friday upwardly revised Spain’s long-term rating to “A,” from “A-,” citing Spain’s favorable progress prospects.
“Recent productivity gains, moderate wage growth and relatively low energy prices have boosted external competitiveness and strengthened private external balance sheets,” Fitch mentioned in an announcement.
The rankings company added that it expects Spain’s economic system to stay resilient, “helped by limited exposure to U.S. tariffs and ongoing web exterior deleveraging.”
Moody’s additionally raised Spain’s rating final week by one notch, to “A3” from “Baa1,” saying the choice displays its view that Madrid’s economic power is improving resulting from a extra balanced progress mannequin, labor market enhancements and a extra sturdy banking sector.
Spain’s economic system has been going from strength to strength of late, bolstered by overseas funding, tourism and immigration.
The nation’s authorities mentioned earlier this month that it expects gross home product (GDP) to expand by 2.7% this 12 months, up from a earlier forecast of two.6%, and considerably above expectations of 1.2% progress seen for the broader euro space.
Earlier this month, S&P Global additionally gave Spain a rating upgrade, citing “notable improvement” within the nation’s stability sheet and an improved resilience to economic shocks.
‘Structural reforms would be the true take a look at’
Judith Arnal, senior fellow on the Elcano Royal Institute, a suppose tank in Madrid, mentioned Spain has emerged because the clear progress chief among the many euro space’s largest economies lately.
“Spain’s growth has relied not only on booming tourism but also on dynamic non-tourism services, such as business, telecoms and IT services. This marks a shift in the country’s growth pattern, showing that Spain has competitive firms able to export beyond traditional sectors,” Arnal informed CNBC by e-mail.
“Growth has also been closely linked to demographic dynamics and job creation. More than half of the jobs created since 2020 have been taken up by immigrants, which has supported overall GDP expansion but meant that GDP per capita has advanced less strongly. This reflects a more extensive than intensive growth model,” she added.
Looking forward, Arnal mentioned that whereas political uncertainty has not prevented Spain from main euro space progress, the nation’s economic efficiency might be even higher with stronger stability.
“The government of Spain is keen to showcase this period of high growth, but fiscal consolidation and structural reforms will be the true test over the medium term,” Arnal mentioned.