S&P ratings says Australia’s AAA rating and outlook isn’t immediately affected by the government’s mid-year budget update

  • Says the update shows a weaker deficit forecast than previously estimated
  • “While weaker, these revised budget forecasts remain broadly consistent with our base case assumptions that deficits will be moderate and declining, and they do not alter our view that general government debt will remain low relative to GDP. We note that, while a number of budget policy measures announced in the May 2014 budget are yet to be passed by the Parliament, a large proportion of these have effect from fiscal 2018, which is when public spending is scheduled to rise significantly under existing legislation. Our current assumption is that further policies will be successfully negotiated over time so that budget performance continues to improve beyond fiscal 2017″