mercredi 18 mars 2015
Fitch Affirms Australia at 'AAA'/Stable
Posted on 01:46 by nice news
Fitch Ratings has affirmed Australia's Long-Term foreign and local currency Issuer Default Ratings (IDR) at 'AAA'. The Outlook is Stable. Australia's senior unsecured foreign and local currency bond ratings are also affirmed at 'AAA'. The Country Ceiling is affirmed at 'AAA', and the Short-Term foreign currency IDR at 'F1+'.
KEY RATING DRIVERS
The affirmation of Australia's sovereign ratings reflects the following factors:
- Australia's highly developed economy, strong governance and effective public and social institutions are consistent with its status as one of the world's most highly-rated sovereigns. A credible policy framework, low public debt and free-floating exchange rate give Australia flexibility to respond to changing economic conditions.
- Real GDP growth is high relative to 'AAA' rated peers, and has been more stable, despite reliance on commodity exports, particularly to China. Fitch forecasts real GDP growth to accelerate to 3.2% in 2016, as a growing output of natural resources more than offsets slowing mining investment. However, the continued fall in the terms of trade has further slowed real income growth. High foreign ownership in the mining industry also curbs the benefits from rising resource exports for the domestic economy. Weak domestic demand, along with cost-cutting in the mining sector, has contributed to a gradual rise in the unemployment rate to 6.3% in February 2015. The Reserve Bank of Australia (RBA) responded with another rate cut - the first since August 2013 - reducing the cash rate to a record low of 2.25%.
KEY RATING DRIVERS
The affirmation of Australia's sovereign ratings reflects the following factors:
- Australia's highly developed economy, strong governance and effective public and social institutions are consistent with its status as one of the world's most highly-rated sovereigns. A credible policy framework, low public debt and free-floating exchange rate give Australia flexibility to respond to changing economic conditions.
- Real GDP growth is high relative to 'AAA' rated peers, and has been more stable, despite reliance on commodity exports, particularly to China. Fitch forecasts real GDP growth to accelerate to 3.2% in 2016, as a growing output of natural resources more than offsets slowing mining investment. However, the continued fall in the terms of trade has further slowed real income growth. High foreign ownership in the mining industry also curbs the benefits from rising resource exports for the domestic economy. Weak domestic demand, along with cost-cutting in the mining sector, has contributed to a gradual rise in the unemployment rate to 6.3% in February 2015. The Reserve Bank of Australia (RBA) responded with another rate cut - the first since August 2013 - reducing the cash rate to a record low of 2.25%.
Fitch Affirms Australia at 'AAA'/Stable
Categories: Fitch Affirms Australia at AAA/Stable
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