Standard & Poor’s has raised the outlook on Portugal’s bond rating to positive from stable.

Portugal’s debt is rated BB, or two levels below investment grade, by the New York-based credit ranking company.

“The outlook revision reflects our view of the gradual recovery of Portugal’s real and nominal growth prospects, alongside policymakers’ commitment to consolidating public finances over the medium term,” S&P said in a statement on Friday.

The ratings agency forecast Portugal’s gross domestic product (GDP) would grow on average about 1.8 percent per year in 2015 and 2016.

“While a firming of domestic demand is likely to continue to drive import growth, the positive impact of the euro zone economic recovery, coupled with a significant decline in oil prices since the second half of 2014 and the depreciation of the euro, should support Portugal’s net export performance during 2015,” S&P added.

It estimated Portugal’s net government debt would drop to 113 percent of GDP in 2018 from 118 percent in 2014.