SAO PAULO (AFP) ― Standard and Poor’s Corp. said Thursday it was upgrading its credit rating on emerging powerhouse Brazil by one notch to BBB.

“We are raising our long-term foreign currency sovereign credit ratings on Brazil to ‘BBB’ from ‘BBB-’ and our long-term local currency ratings to ‘A-’ from ‘BBB+’,” the ratings agency said in a statement. “The outlook is stable.”

It noted that the upgrade reflected Brazil’s increasing capacity to hold up against the overall deterioration in the global economic outlook.

Brazil is one of the five BRICS nations ― which include China, Russia, India and South Africa ― expected to count as the major economic powers of the future.

The Brazilian foreign ministry welcomed the upgrade, saying it was recognition that the country’s economic policy was heading “in the right direction and its macro-economic fundamentals are ”solid.“

It described the S&P announcement as evidence of the “success of the management of the Brazilian economy in its goal of strengthening the country.”

S&P said the government of President Dilma Rousseff has “demonstrated its commitment to meeting fiscal targets, thereby enlarging the scope for using monetary tools to influence the domestic economy.”

“We expect the government to pursue cautious fiscal and monetary policies that, combined with the country’s growing economic resilience, should moderate the impact of potential external shocks and sustain long-term growth prospects.”

The South American giant has size, population and above all natural resources on its side, with the country fast modernizing over the past 20 years after struggling to develop its economy with a large, modern manufacturing sector so as to reduce its dependence on raw material exports.

A credit ratings upgrade normally makes it easier and cheaper for a country to borrow on the financial markets, while boosting investor confidence in its outlook.