Fitch Affirms Uruguay at 'BBB-'; Outlook Stable

Fitch Ratings has affirmed Uruguay's Long-Term (LT) Foreign Currency (FC) and Local Currency Issuer Default Rating (IDR) at 'BBB-'. The Rating Outlook is Stable.

• Uruguay's 'BBB-' rating is supported by relatively high GDP per-capita, strong governance indicators and institutional strength evidenced by a successful pandemic response, and robust external finances.
• The rating is constrained by muted medium-term economic growth prospects affected by competitiveness challenges, a public debt burden above rating peers and sensitive to exchange-rate movements, persistently high inflation and policy flexibility constrained by dollarization, indexation, and shallow financial depth.
• The government is committed to policies to improve these credit weaknesses, but faces challenges in advancing these.