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20 May 2014
Australia faces prospects of losing AAA rating status
FXStreet (Bali) - In news crossing the wires earlier on Monday, ratings agency Standard & Poor’s warned that Australia faces the prospects of losing its triple A credit rating status if they are unable to adjust their annual budget in coming years, which would require significant cuts in spending.
Cited by AFR, a lead sovereign analyst for S&P, Craig Michaels, said "he was counting on the Abbott government to win Senate approval for at least “some” of its $37 billion in planned savings against opposition from Labor, which has pledged to veto about $18 billion in cuts and tax rises."
“We’re looking to see the government improve budget performance over the next few years,” Mr Michaels said in an interview, notes AFR.
"In case that sizeable budget deficits were considered acceptable at the political and the community level then we might reassess, certainly, government commitment and also potentially the trajectory for public sector debt,” Mr Michaels said, adding that "we’re looking for present action."
“If the government chooses to substantially water down its proposals because of the political cost, that is the sort of thing that would concern rating agencies looking at Australia over the longer term,” he added.
Cited by AFR, a lead sovereign analyst for S&P, Craig Michaels, said "he was counting on the Abbott government to win Senate approval for at least “some” of its $37 billion in planned savings against opposition from Labor, which has pledged to veto about $18 billion in cuts and tax rises."
“We’re looking to see the government improve budget performance over the next few years,” Mr Michaels said in an interview, notes AFR.
"In case that sizeable budget deficits were considered acceptable at the political and the community level then we might reassess, certainly, government commitment and also potentially the trajectory for public sector debt,” Mr Michaels said, adding that "we’re looking for present action."
“If the government chooses to substantially water down its proposals because of the political cost, that is the sort of thing that would concern rating agencies looking at Australia over the longer term,” he added.