Moody’s leaves NZ credit rating unchanged
(27 October 2011 – New Zealand) Rating agency Moody’s confirmed New Zealand’s AAA credit rating after Treasury’s pre-election economic and fiscal update was largely in line with expectations.
Moody’s vice president and senior credit officer, Steven Hess told Dow Jones Newswires via email that the future path of government deficits and debt is overall not too different from earlier projections.
Treasury has confirmed the Government's books are on track to return to surplus in 2014/15 but warned that risks to the forecasts were skewed to the downside.
Dow Jones said Hess underscored that while the overall situation in New Zealand had not changed much, 'the situation in global financial markets, particularly as it relates to sovereign debt, has changed.'
The main question was access to external financing and the cost of borrowing for the country as a whole not just the government.
'So far, despite what has happened in Europe, the effects on New Zealand don't seem to have been very great,' he said.
Treasury forecast an increase in the current account deficit that would push the country's net debt up from 70 percent to almost 80 percent.
Moody's visited New Zealand this month as part of its annual review of the sovereign rating.
In September Standard & Poor's and Fitch both cut New Zealand's rating from AA+ to AA.
Treasury has confirmed the Government's books are on track to return to surplus in 2014/15 but warned that risks to the forecasts were skewed to the downside.
Dow Jones said Hess underscored that while the overall situation in New Zealand had not changed much, 'the situation in global financial markets, particularly as it relates to sovereign debt, has changed.'
The main question was access to external financing and the cost of borrowing for the country as a whole not just the government.
'So far, despite what has happened in Europe, the effects on New Zealand don't seem to have been very great,' he said.
Treasury forecast an increase in the current account deficit that would push the country's net debt up from 70 percent to almost 80 percent.
Moody's visited New Zealand this month as part of its annual review of the sovereign rating.
In September Standard & Poor's and Fitch both cut New Zealand's rating from AA+ to AA.
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