Fitch affirms Luxembourg AAA rating

Ratings agency Fitch has affirmed Luxembourg’s long-term foreign and local currency issuer default ratings at AAA with a stable outlook.

The ratings on its senior unsecured local currency bonds have also been affirmed with AAA.

The rating takes into account Luxembourg’s high income per capita, strong governance indicators, high growth potential and solid public finances weighed against its higher macroeconomic volatility and heavy reliance on the financial services sector.

Fitch expected a reduction in government surplus from 1.6% of GDP in 2015 down to 1.2% of GDP in 2016. It forecast a fall in the budget balance to 0.1% of GDP.

The rating comes exactly a month after Standard & Poor’s issued a AAA rating with stable outlook.

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