Bloomberg has today announced that Lithuania had the outlook on its credit rating raised by Fitch Ratings after the Government implemented an austerity program to curb the budget deficit.

The outlook on the BBB rating, the second-lowest investment grade, was lifted to stable from negative. Standard & Poor’s on February 3 also lifted its outlook to stable on a BBB rating.

The Government of Prime Minister Andrius Kubilius cut budget spending and increased taxes to save about 9 % of gross domestic product last year. The Cabinet plans a further fiscal consolidation of 5 % of GDP in this year’s budget.

“Financial and economic stabilization,” and “the impressive external adjustment of the past year, supports the change in the outlook,” Douglas Renwick, a London-based analyst at Fitch, said in Bloomberg’s statement. While “the fiscal deficit remains high, consolidation measures enacted to date have been substantial and the Government has articulated a credible medium-term plan for reducing” it “to 3 % of GDP by 2012.” Fitch estimates the 2009 deficit was 9.1 % of GDP and may narrow to 8 % this year.