S&P affirmed Kenya’s ‘B/B’ long- and short-term foreign and local currency sovereign credit ratings with a stable outlook.
According to S&P, the stable outlook balances expectations of relatively strong economic growth and modest fiscal consolidation against the pressure of a more difficult global financing outlook. The stable outlook also assumes that the post-election handover will go relatively smoothly, without significant conflict or dislocation of institutional settings.
The ratings could be upgraded if there is a significant and sustained improvement in Kenya’s fiscal and external accounts against a backdrop of strong growth while institutional mechanisms remain robust. Conversely, the ratings could be downgraded over the next year if institutional risks rise, Kenya’s economic growth prospects weaken, or access to foreign funding is curtailed, resulting in a sustained decrease in foreign currency.