Moody’s lists three main reasons for awarding Luxembourg its AAA rating:
- The country’s strong economic resilience, robust growth potential and high degree of economic flexibility
- Its strong public finances and low debt burden, which result in a great capacity to absorb exogenous shocks. It can be noted that Luxembourg is the EU country whose debt has increased the least during the pandemic
- Luxembourg’s robust and transparent institutional framework, which is confirmed by its very solid governance indicators, prudent and predictable political decision making and effective financial regulation and supervision
Fitch attributes Luxembourg’s AAA rating to the country’s resilience to the shock of the COVID-19 pandemic. Its real GDP had already returned to pre-pandemic levels in the fourth quarter of 2020, and Fitch foresees a GDP growth of 4.6% in 2021, 3% in 2022 and 2.3% in 2023.
S&P confirms the Grand Duchy of at AAA with main reasons: strong public finances, a sizable stimulus package in response to the pandemic, and a long track record of a solid budget and sustainable economic growth.
https://www.tradeandinvest.lu/news/moodys-confirms-luxembourgs-aaa-rating/
https://www.tradeandinvest.lu/news/fitch-awards-luxembourg-finances-aaa-rating/
https://today.rtl.lu/news/science-and-environment/a/1786983.html