After one year, U.S rating agency Moody's reservedly "took note" of Romania's improved economic situation.
In its six years of evaluating Romanian risks, Moody's has been more severe in its assessments than the other two big rating agencies - Standard&Poor's and Fitch and often slammed the Romanian authorities over "inconsistency" in the macroeconomic stability and structural reform.
The agency upgraded Romania's country ceiling for foreign currency bonds to B1 from B2 and the ceiling for foreign currency bank deposits to B2 from B3. Accordingly, the government's domestic currency bond rating was also raised to B1. The outlook on all ratings is stable.
As far as Moody's is concerned, Romania still hasn't managed to rise back to its 1996 performance, when it had been assigned a Ba3 rating.
The B1 rating shows that investments in the bonds issued by Romania on the international markets are speculative in a high degree. However, the old rating was clashing with the market trends, which show that Romania's risk outlook has considerably improved, with increasingly more investors looking to buy Romanian bonds.
Even the B1 rating can be deemed as strict, since it shows that Romania should pay a 4% risk premium for its bonds. This means Moody's announcement will not make a significant impact on the international markets, but will convey a positive signal to the conservative, risk-sensitive investors.
The rating upgrading had been expected for the beginning of next year. According to foreign analysts, Moody's decision was a reaction to the EU reaffirming 2007 as the target for Romanian and Bulgarian accession.
Moody's analysts also note that Romania's state sector has mostly not been restructured.
"The weak financial position of the large state-owned enterprises, particularly in the energy sector, has limited sustained improved in macroeconomic performance, hampered economic development, and at times placed pressure on debt servicing," the Moody's report shows.
According to Moody's, the restructuring of state entities is "the key" to fiscal consolidation and to less volatility in the conduct of demand-management policies. Moreover, it is vital for the more efficient allocation of resources, which is necessary to enhance productivity.
Of all the CEE countries, Bulgaria has been granted the same rating, but its outlook is positive.
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