Fitch Gives Israel an A with a Stable Outlook
The Fitch credit rating agency announced Wednesday that it had ratified Israel's credit rating and set it to A with a stable outlook, the Globes financial newspaper reported.
In a statement, the agency noted Israel’s macroeconomic performance and indicated that it left the outlook as stable despite the crisis with Iran and the talk about a possible Israeli attack on Iranian nuclear facilities.
According to Globes, Fitch is estimating that growth in Israel in 2012 will stand at about 3 percent, noting it is a temporary decline compared to the growth in the years 2010 and 2011 which stood at over 4 percent. As well, Fitch is estimating that Israel’s economic growth in 2013 will stand at 3.5 percent of the GDP.
According to Richard Fox, an analyst with Fitch, the agency’s forecast does not include Israel’s natural gas discoveries which will have an effect on the local economy, particularly since they can protect Israel from a possible future increase in world oil prices.
On the other hand, Fox told Globes, the forecast does not take into account the possibility of an escalation in the Israel-Iran crisis. He added that he believes things have died down recently in this area, especially in light of the contacts between the West and Iran and the tightening of the sanctions on the Islamic Republic.
In response to Fitch’s announcement, Finance Minister Yuval Steinitz said, “Given the economic situation in the international markets, the ratifying of the rating is a testament to the stability and strength of our economy. In addition, the announcement further emphasizes the importance of maintaining fiscal discipline.”
Two months ago, Steinitz met with representatives of Moody’s Investors Service and asked them to raise Israel's credit rating.
In September, the world's largest credit rating agency, Standard & Poor's (S&P), raised Israel's credit rating from A to A+.