Mubasher: Standard and Poor’s (S&P) announced that it has confirmed Qatar’s long and short-term foreign and local currency sovereign ratings at “AA-/A-1+” with a negative outlook, according to the international credit rating agency’s statement.

The New York-based ratings agency noted that the decision reflects its expectation that the Qatari government will continue to actively manage the boycott while preserving Qatar's core rating strengths, including its strong public sector balance sheet.

“The government has taken measures to ease the immediate economic and financial effects of the boycott,” according to the statement released late on Sunday.

Since 5 June 2017, Qatar has been facing outflows of foreign customers' deposits after four Arab countries led by Saudi Arabia cut their diplomatic and trade ties with the gas-rich state, accusing Qatar of financing terrorism. Doha forcefully denies the charges.

"The fall in non-resident deposits and inter-bank placements has been offset by liquidity injections by Qatar Central Bank (QCB) and repatriation into the domestic banking sector of about $40 billion of public sector assets previously held abroad,” the statement highlighted.

According to the agency, Qatar might see further non-resident deposit outflows on the back of their maturity, expecting it would be manageable.

S&P expects Qatar's liquid external assets to continue to offset the GCC country's stock of debt by a reasonable margin.

The Qatari liquid assets are expected to remain high at over 130% of gross domestic product (GDP) in 2018.

"Over the medium term, we expect the current account balance to remain in a surplus of 4 percent in line with our revised modest increase in our oil price assumptions,” the statement added.

Source: Mubasher

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