Already a subscriber?Moody’s has warned that health, aged care and other “structural spending pressures” could leave future federal budgets mired in deficit and make surpluses difficult, even as it says it is unclear whether new cost-of-living measures will add to inflation.
“Mechanical impacts on measures of the inflation rate may be moderately offset by additional spending in the context of a still-tight labour market, delaying the Budget’s forecast relatively fast decline in inflation,” said Moody’s credit officer Martin Petch. Even so, both rating agencies have maintained Australia’s triple-A rating. The nation is one of only 11 countries still enjoying a top rating from all three major credit agencies.
“This in turn means the government needs to be less concerned about will there be enough buyers for any extra debt they may need to issue.”
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