S&P credit rating agency
S&P credit rating agencyBrendan McDermid/Reuters

The S&P credit rating agency on Friday left Israel's credit rating at AA- and its credit rating outlook at "stable".

In a statement, S&P said that the basis for the decision is an assumption that a certain agreement will be reached regarding the government’s proposed judicial reform, allowing for a relaxation of increased political tensions.

The agency also said that it anticipates that the current political uncertainty in Israel, combined with the tightening of monetary policy and weaker economic performance in Israel's main trading partners in Europe and the United States, will result in a slowdown in growth in the Israeli economy to 1.5% in 2023 from 6.5% in 2022.

S&P noted that Israel still enjoys a number of strong characteristics such as a diversified economy, a strong balance of payments and a moderate level of public debt.

Friday’s announcement comes a month after Moody’s downgraded Israel’s credit rating outlook to stable.

“The change of outlook to stable from positive reflects a deterioration of Israel's governance, as illustrated by the recent events around the government's proposal for overhauling the country's judiciary,” the credit rating agency said at the time.

Prime Minister Benjamin Netanyahu and Finance Minister Bezalel Smotrich said in response to Moody’s decision, "The State of Israel is a strong democracy, and because of that, Israeli citizens hold lively discourse over issues that are the center of controversy in Israeli society, and those are signs of the strength of Israeli democracy."

(Israel National News' North American desk is keeping you updated until the start of Shabbat in New York. The time posted automatically on all Israel National News articles, however, is Israeli time.)