Moody's: Political deadlock poses risk for Israel's rating

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Moody's is concerned about Israel's ability to tackle its growing budget deficit.

Moody's credit rating agency has put out a statement following Israel's inconclusive election, warning that the failure to set up a stable government could affect Israel's credit rating. Moody's currently rates Israel as A1 with a positive outlook.

In particular, Moody's is concerned about Israel's ability to tackle its growing budget deficit, which it expects to reach 4% this year and remain that high next year.

Moody's said, “The ability and willingness of the next government to address the difficult fiscal trajectory in a timely manner, such that the material debt reduction gains of the past decade are broadly preserved, will be an important driver of our assessment of the sovereign credit profile."

Moody's added, “The failure to form a new government, or the formation of a disparate coalition unable to command the internal consensus needed to advance new fiscal measures, would present a risk to Israel’s credit profile."

Published by Globes, Israel business news - en.globes.co.il - on September 20, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

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