Bahrain Mirror: Standard & poor's (S&P) agency downgraded Bahrain's sovereign debt rating from "BB" to "BB-", but said the outlook for the Kingdom and its central bank is stable.

The Agency said that the gradual depletion of foreign exchange reserves in Bahrain is troubling and limits flexibility in response to external pressures.

S & P said that reducing Bahrain's credit rating reflects the increasing risks caused by the deterioration in external financing conditions amid continuous decline in foreign exchange reserves.

It added that the outlook reflects the financial support from Saudi Arabia, which would come if needed to disperse the impact of external and financial pressures.

The agency pointed out that the talks conducted by OPEC recently might bring positive developments with regard to oil prices and then export revenues.

The Agency predicted a continuous deficit in the balance of current Bahraini transactions with possibility that the deficit adds more pressure on cash reserves and increases the need for external financing.

Arabic Version