BAKU, Azerbaijan, October 26. A potential is being created to move to the investment category for Azerbaijan's Eurobonds, Deputy Head of the Market Analysis Department of Russian Gazprombank Gulnara Khaidarshina told Trend.
According to her, improving Fitch's forecast to "positive" is favorable for Azerbaijan's Eurobonds.
"Currently, thanks to the implementation of Fitch's rating upgrade factors (diversification of economy, improvement in external liquidity and budget indicators), Azerbaijan's Eurobonds are creating the potential to move to the investment category on a 12-month horizon and reduce their yield by at least 2.6 percent," Khaidarshina said.
"Gazprombank looks positively on Azerbaijan as a sovereign issuer, given the low debt burden, the highest availability of international reserves in the Commonwealth of Independent States (CIS), strong economic growth, Azerbaijan’s growing role as a Eurasian logistics center in the context of restructuring global supply chains, economic diversification through new projects in Karabakh and maintaining macroeconomic stability and the availability of sufficient resources to maintain a stable manat [country's national currency] exchange rate in the medium term," she stated.
Fitch agency improved the outlook on Azerbaijan's sovereign rating to "positive". This action followed a rating upgrade by Moody's in August. Fitch noted that high hydrocarbon prices further improve Azerbaijan's external and internal balance sheets. Fitch expects Azerbaijan's current account surplus to widen to 27.3 percent of GDP (year-on-year increase of 12.1), the highest level in the 'BB' rating group.