...January 7, 2020 MADRID (S&P Global Ratings) Jan. 7, 2020--S&P Global Ratings said today that the formation of the new government in Spain should have no immediate effect on its sovereign credit ratings on Spain (unsolicited; A/Stable/A-1). Incumbent prime minister, Mr. Pedro Sanchez of the Socialist Party, will lead a minority government supported by its junior coalition partner, Unidas Podemos. This is Spain's first-ever coalition government. The new government has not yet clarified its approach to economic and fiscal policy, but we do not anticipate major changes. Initially, we expect the new government to focus on passing a budget for 2020. This may prove to be difficult as the European Commission has demanded that Spain cap planned increases in primary expenditure and commit to a further structural reduction in its budget deficit. Meanwhile, the coalition members all favor increasing social spending (as well as tax receipts). Addressing Spain's existing economic challenges requires...
