Fitch reconduit le „AAA“ du Luxembourg

On 13 January 2023, the Luxembourg Ministry of Finance published a press release, informing about the confirmation by the rating agency Fitch of the „AAA“ credit rating for the Grand Duchy of Luxembourg, with a stable outlook.
This better rating reflects the Grand Duchy’s good governance indicators, the good performance of public finances and the country’s economic resilience despite the current uncertain context.
Following the economic slowdown in Europe, the agency forecasts a fall in GDP growth in Luxembourg to 1.5% for the year 2023, against 2% in 2022. Fitch estimates that thanks to support measures (Energiedësch, Solidaritéitspak 1 and 2) put in place by the Government in 2022, purchasing power, private consumption and the level of investment will continue to evolve favorably.
The agency also notes that inflation has continued its downward trend and expects 3.9% in 2023, 2.4% respectively in 2024, and notes a slowdown in the evolution of property prices.
However, the analysis points to a number of downside risks for Luxembourg as an open economy, including weaker than expected growth in Europe, or a possible recovery in energy prices.
In this context, the agency notes that Luxembourg’s prudent budgetary policy remains one of the key factors in its assessment. With this in mind, Fitch expects that the level of public debt will be maintained at all times below the threshold of 30% of GDP, set in the government program.