Fitch Ratings raised its outlook on Ireland to stable from negative, citing the government’s actions to narrow the fiscal deficit and a view that the nation’s banks probably won’t need further state capital.

“Fiscal consolidation remains on track, broadly in line with the original trajectory of the EU-IMF programme, which envisaged a 120 percent debt to GDP ratio in 2012, peaking in 2013-14 before declining,” the ratings firm said in a statement, where it affirmed it BBB+ rating on the nation.

Still, Ireland’s rating remains “constrained and faces downside risk” due to high public and private debt levels.

The yield on Ireland’s benchmark security due in October 2020 fell five basis points to 4.72 percent today, down from 14 percent in July 2011.

To contact the reporter on this story: Joe Brennan in Dublin at jbrennan29@bloomberg.net

To contact the editor responsible for this story: Dara Doyle at ddoyle1@bloomberg.net