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SYDNEY May 9 Australia's prized triple A credit
ratings appeared safe on Tuesday as two leading ratings agencies
welcomed the government's promise to return its budget to
surplus within four years, after more than a decade of deficits.
Australia is among 10 countries still rated triple A by all
three major agencies, but slower economic growth in recent years
and a stubborn fiscal deficit have jeopardised its top ranking.
Australia's conservative government pledged to deliver a
small A$7.4 billion ($5.4 billion) surplus in 2020/21, an
improvement on the A$1.08 billion it forecast in the mid-year
review in December.
"These projections denote ongoing commitment to fiscal
consolidation," said Marie Diron, an associate managing
director, at Moody's Investors Service, adding Australia's
fiscal position was a key support to the government's triple A
rating and stable outlook.
Underpinning the return to surplus are revenue-raising
measures including a national health levy and a new charge on
major banks which will offset savings that were in previous
budgets but blocked in parliament.
Moody's said the removal of the blocked measures from the
budget projections enhanced the transparency and predictability
of budget outcomes and was a credit positive.
Fitch also welcomed the new revenue proposals as they
implied a faster reduction in general government deficit than
the ratings agency had projected in its September review.
Still, while Fitch and Moody's were quick to say the budget
had no major impact on Australia's top ratings, S&P Global was
not immediately available to comment.
S&P put Australia on negative watch last July, citing
weakened prospects for improvement in budgetary performance.
(Reporting by Cecile Lefort; Editing by Simon Cameron-Moore)