In its latest sovereign credit review, S&P Global ratings revised the outlook for Australia to ‘stable’ while affirming ‘AAA’ ratings.
Additional takeaways
“Australia outlook revised to stable on swift economic recovery; AAA/A-1+' ratings affirmed.”
“Australia's response to contain the pandemic, limit long-term economic scarring has seen economy recover quicker, stronger than previously expected.”
“More confident general govt's fiscal deficits to narrow toward 3% of GDP during next 2-3 years after 10% deficit in fiscal 2021.”
“Govt's policy response and strong economic rebound have reduced downside risks to our economic and fiscal outlook for Australia. “
“Stable outlook reflects our expectations that the general government fiscal deficits will narrow in line with our forecasts.”
Market reaction
Amid a fresh recovery attempt seen in the US dollar, AUD/USD shrugs off the upbeat S&P report and tests daily lows near 0.7730, down 0.06% on the day.