S&P revises Bahrain's outlook to 'stable' on fiscal deficit worries

S&P Global Ratings revised Bahrain's outlook to "stable" from "positive", citing spending pressures that could push the country's fiscal deficit wider than the credit ratings agency previously expected.

S&P maintained its "B+/B" ratings on the country and said it expects that the government will implement measures to reduce its budget deficit and benefit from additional support from other Gulf sovereigns if needed.

"We expect the government will reinvigorate reforms to consolidate its fiscal position, largely via increasing non-oil revenue through 2026," it said in a statement.

The agency now projects fiscal deficits of 3% to 4% of Bahrain's GDP over 2023-26, compared with 2% to 3% in its previous review.