S&P affirms sovereign ratings for Bangladesh; outlook remains stable

Standard and Poor’s (S&P) has affirmed its ‘BB-’ long-term and ‘B’ short-term sovereign credit ratings for Bangladesh, as the country makes sound economic growth in face of heightened external pressure.

The outlook remains stable. Bangladesh has an elevated current account deficit and declining foreign exchange reserves, said the rating agency.

 “Nevertheless, Bangladesh’s economic growth trajectory remains sound, and we expect external conditions to gradually stabilise over the next 12 months,” it said.

The ratings reflect Bangladesh’s modest per capita income and limited fiscal flexibility owing to a combination of diminished revenue-generation capacity and elevated interest burden. Evolving administrative and institutional settings represent additional