Australia is one of just 10 countries to retain its AAA credit rating through the coronavirus-induced global recession based on Moody’s Investors Service most recent assessment. Moody’s says that Australia’s AAA stable credit rating reflected the economy’s strengths and good governance – including health management – that will support the country’s resilience in response to the coronavirus pandemic. Moody’s forecast the economy to shrink by 5% this year, though it said the government’s $150 billion in budget spending and support from the Reserve Bank of Australia would mitigate the contraction.
“In Moody’s assessment, the resilience of the Australian economy supports a return to positive growth next year, without any significant long-lasting impact on growth potential once the crisis passes,” it says. By international standards, Australia has relatively low public gross debt of about 42% of GDP. Moody’s forecasts it to exceed 50% by 2021 and rise modestly thereafter. Australia received a AAA rating from all three major rating agencies: Moody’s, S&P Global Ratings and Fitch Ratings.