LONDON – Fitch Ratings has affirmed Bahrain's Long-term foreign currency Issuer Default Rating (IDR) at ‘BBB' and its local currency IDR at ‘BBB+'. The Outlook is Stable. The agency has simultaneously affirmed Bahrain's Country Ceiling at ‘BBB+' and Short-term foreign currency IDR at ‘F3'. The affirmation reflects the stabilization of the political crisis that peaked in February and March of 2011. Fitch resolved the ‘BBB'/Rating Watch Negative in August 2011 by returning the Outlook to Stable as the agency considered the worsening of Bahrain's political climate was adequately reflected in its ‘BBB' rating. Economic performance has also been robust in the face of the political unrest, benefiting from high oil prices and production levels and an increase in government spending. A number of industries, particularly the services sector, saw output decline in H111, although indicators point to a recovering economy in 2012, with Fitch projecting GDP growth of 3.5 percent for 2012, following 2.2 percent growth in 2011. – SG
