“Australia’s negative outlook reflects a substantial deterioration in fiscal space at the ‘AAA’ rating level and our view is that risks remain on the downside“S&P Global Ratings said in a statement Tuesday, Reuters reported.
“Downside risks persist after the budget, supporting our negative outlook on Australia,” the rating agency explained. They indicated that the increase in revenues will give the government some leeway for the new measures.
Among the risks to the economy, S&P said that Trade tensions and geopolitical risks are likely to hamper parts of the economy.
The maintenance of the ‘AAA’ credit rating is based on the expectation that the deficit will be reduced in the long term.