Actually, nothing more needs to be said than the headline says: the outlook for Israel is stable and it is maintaining its good credit rating.
FitchRatings wrote today, at the 1st of March #23: “Israel’s ‘A+’ rating balances a diversified, resilient and high value-added economy and strong external finances against a high government debt/GDP ratio, elevated security risks and a record of unstable governments that has hindered policymaking.”
Are there any risks? Naturally. Israel is in a geopolitically complex situation, Israel has a rapid succession of governments and its institutions are inefficient and in need of reform.
Even more, FitchRatings sees Israel’s economy as robust and wrote: “Fitch expects Israel’s GDP growth to remain robust at 2.9% in 2023 after 6.4% in 2022, despite global challenges and monetary policy tightening that will hit private consumption and investment. Growth will be supported by continued exports from the high tech and the defence industries, strong population growth and growing government spending once a budget is in place.”
FitchRatings also notes that the planned judicial reform is being met with strong protests, which are currently the actual credit risk: “The government made it a priority to pass a judicial reform that would curtail the powers of the Supreme Court and grant more power to the government majority in the Knesset on legislation and over the nomination of judges. The reform has been met with strong civil society and political opposition.”
So, case closed.
Blog 'VonNaftali' 