December 19, 2016 / 2:41 AM / 7 months ago

Moody's says Australia's budget update in line with Aaa ratings

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SYDNEY, Dec 19 (Reuters) - Moody's rating agency endorsed Australia's budget update on Monday, saying it was in line with its triple-A ratings and stable outlook, although the government had forecast a A$10 billion deterioration in its cash deficit.

"With fiscal metrics broadly in line with other Aaa-rated sovereigns, Australia's Aaa rating and stable outlook are underpinned by very high shock absorption capacity of the economy and very strong policymaking institutions," said Marie Diron, associate managing director at Moody's.

Moody's said though it expects the budget deficits to be wider for longer with gross general government debt to rise to 42 percent of GDP from the current 36 percent, Australia's standing was consistent with the median level of Aaa-rated sovereigns.

Reporting by Cecile Lefort; Editing by Eric Meijer

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