Australia’s AAA Rating at Risk

Australia’s much-coveted AAA credit rating has been in the spotlight this week after a report in the local media that Standard & Poor’s could review the rating unless big budget cuts are made in coming years.

The credit ratings agency, one of the world’s three biggest, has also been reported as saying that there is no immediate risk to the rating, which it has on a stable outlook.  What then is the big deal? The short answer is politics related to passing last week’s federal budget.

Both Prime Minister Tony Abbott and Treasurer Joe Hockey said this week that Australia’s credit rating could be at risk if the opposition Labor Party side with minority parties to block budget measures in the Senate – the upper house of parliament.


This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.