Moody's affirms Australia's Aaa credit rating and stable outlook

[SYDNEY] Moody's Investors Service on Wednesday affirmed Australia's Aaa credit rating with a stable outlook, putting it at odds with Standard & Poor's which recently put the country on watch for a downgrade.

The agency cited Australia's track record of economic resilience, a very robust institutional framework and stronger fiscal underpinnings than many other top-rated countries. "The stable outlook on Australia's rating reflects Moody's expectation that Australia's credit profile and related metrics will remain consistent with a Aaa rating," it said in a statement.

"Moody's believes that Australia's credit profile will be resilient to potential negative shocks."

The vote of confidence could reassure investors in Australian government bonds that might have been unsettled by S&P's warning last month of a downgrade.

S&P made it clear the onus was very much on the newly returned conservative government of Malcolm Turnbull to repair its budget shortfalls or risk losing the agency's AAA rating.

Australian Treasurer Scott Morrison portrayed Moody's decision as a vote of confidence in the government. "In these difficult economic times, maintaining our triple-A rating is a welcome boost and a timely reminder that we need to keep our focus on the policies that keep our economy strong," Mr Morrison said in a statement.

Fitch also rates Australia AAA and recently affirmed the rating with a stable outlook.

REUTERS