According to the Fitch agency, the competitor S&P also maintains its top ratings for Germany. This means that the Federal Republic can continue to take on debt at preferential terms in the future. S&P affirmed the ratings at “AAA/A-1+” and left the outlook at “stable” – meaning no deterioration is expected in the near term.
Modest real economic growth of 0.3 percent is expected for Germany this year, as demand from home and abroad will recover in the second half of the year, it said. S&P also assumes that budget deficits will decrease in the next few years. Fitch recently left its rating for Germany “AAA” and its outlook “stable” unchanged. The rating reflected, among other things, Germany’s broad-based economy, a robust banking sector and solid finances, it was said.
But Europe’s largest economy faces several structural challenges, including an aging population that is beginning to put pressure on public finances and the labor market.