Why Moody’s keeps Greece in ‘junk’ status

A few days after raising the outlook of Greece's credit rating to "positive," Moody's referred to the factors that contributed to Greece's Ba1 rating and prevented the granting of investment grade to the country.

Greece's credit profile, the rating agency noted, is determined by four factors: Economic power, the strength of institutions and governance, fiscal strength and the country's vulnerability to event risk.

Moody's argues that Greece has a rather mediocre score in economic power because its economy is less diversified than those of its European Union peers and still has a low - albeit rising - investment index. The efficient absorption of resources from the EU's Recovery Fund will be crucial for the strengthening of investments and midterm growth, it notes.

Regarding the strength of institutions and governance, Moody's notes an improvement, though...