Moody's ratifies A2 rating for Israel, says outlook is stable
02.3.06 | 12:06 By Shlomy Golovinski
Moody's today published its annual review of Israel, and ratified an A2 credit rating.
The outlook for Israel is stable, the agency wrote.
Israel's government and economy have proven resilient to significant external shocks that happened concurrently, Moody's writes.
The agency feels that the resilience Israel demonstrated proves the strength of its institutional infrastructure, of the civilian population, and of the economic and political echelons.
In recent years, structural reforms distanced the economy from its overly concentrated past, transforming its structure into a more modern, competitive and market-oriented one, says Moody's. Continuation of these trends, and institutional changes that developed starting in 2003, should stimulate long run growth while depressing inflation, unemployment and income inequality, predicts the rating agency.
Combined with responsible fiscal policy that encourages reduction of the public sector and lower national debt, Israel can maintain low interest rates and encourage private-sector investments, creating inducements to raise its sovereign credit rating.
In recent years Israel has run a surplus in its current account, the agency adds, and it also has a comfortable level of foreign currency reserves vis a vis repayment of foreign debt.
haaretz.com
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