MANILA -- Moody's Investor Service said Tuesday it kept its credit rating and outlook on the Philippines, as it highlighted the economic risk of the COVID-19 pandemic and resulting lockdowns.

Gross domestic product could shrink by 2.5 percent in 2020, said Moody's, which rated the Philippines at Baa2 or one notch above minimum investment grade. The outlook is stable, meaning neither an upgrade or downgrade is forthcoming.

A higher credit rating means the Philippines can access a wider pool of investors for debt and at lower interest. Last week, Fitch Ratings downgraded its outlook on the country to stable from positive while keeping its score, at one step below the minimum A score.

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"The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and financial market turmoil are creating a severe and extensive economic and financial shock," Moody's said in a statement.

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The Philippines first quarter GDP unexpectedly shrank 0.2 percent, the first contraction since 1998 and according to analysts and economic managers, the next 2 quarters could be worse as the full effect of the lockdown is reflected.

Metro Manila has been under "enhanced community quarantine" with most businesses shuttered since March 17. It was extended twice and President Rodrigo Duterte is expected to decide within a week whether to extend it past May 15.

Other urban centers such as Cebu and Davao are also under ECQ until May 15. The rest of the country is under general community quarantine or GCQ with fewer restrictions.

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Moody's said it would upgrade the Philippines' rating should there be a "marked convergence" between per capita income growth and government revenue generation. A downgrade will happen if there is macroeconomic instability and reversal of reforms, it said.

"Moody's expects the Philippines' real GDP growth to remain robust relative to peers and that its fiscal metrics will continue to strengthen as the government continues to make progress on its socioeconomic reform agenda, particularly on tax reform," it said.

"However, the global coronavirus outbreak threatens the Philippines through a number of channels, including trade, supply chain linkages, investment, remittances and tourism, while stringent containment measures will also sharply curtail domestic demand," it said.