Standard and Poor's on Wednesday said that it is raising the long-term foreign and local currency debt ratings on Greece to 'CCC/C' from 'selective default' (SD) following the completion of the "distressed" debt exchange.
The outlook on the long-term rating is 'stable' reflecting S&P's view of the government's stated commitment to improving its fiscal track record.
S&P said its criteria defines the emergence from a sovereign default as the successful completion of an exchange offer, even if nonparticipating creditor debt remains unpaid.
"While the exchange has, in our view, alleviated near-term funding pressures, Greece's sovereign debt burden remains," the agency said in a statement.
S&P expects the recession to continue in 2012 as GDP shrinks by around 5 percent. It forecasts the government debt to be between 160 percent and 170 percent of GDP in the period 2012-2015, depending on Greece's compliance with the EU/IMF financial program targets.
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