Moody's, the world's second-largest credit rating agency, raised Israel's credit rating outlook from negative to "stable.".
According to Moody's economists, Israel's geopolitical risk has decreased compared to the peak during the war, as there has currently been no broad escalation with Iran, the fighting with Hezbollah has ended, and the ceasefires in Gaza and Lebanon have been in place since the end of 2024.
The world's largest credit rating agency, Standard & Poor's (S&P), announced last November that it was leaving Israel's credit rating unchanged, A, in its semi-annual report. However, the company raised its outlook from "negative" to "stable.".
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The Accountant General of the Ministry of Finance, Yahli Rotenberg, said after the Sabbath: “Moody’s update joins a broad trend to re-examine the risk assessment of the Israeli economy. In retrospect, the company’s announcement emphasizes the resilience and strength of the Israeli economy over the past two years, which were actually higher than expected, and the fact that the impact on the fiscal situation was significant but remained under control.
""At the same time, we see that this assessment is also supported by the reflection of market performance: the significant decrease in the risk premium in recent times reflects investor confidence, responsible debt management, and the State of Israel's high accessibility to markets.""
The Accountant General added: “Looking ahead, consistent fiscal discipline and continued convergence measures are required to ensure a downward trend in the debt-to-GDP ratio over time. The path to strengthening the credit rating is still in full swing, and the current update is an important step along the way.
""I am ending my role today after challenging years during which complex rating decisions were also made, and therefore the trend of improvement in the rating that we are now seeing has special significance. This trust is not taken for granted; it is the result of professional, consistent, and responsible work by many along the way. The foundations built during this period provide a solid infrastructure for continuing to strengthen the markets' confidence in the Israeli economy, while maintaining a responsible fiscal policy.".
Finance Minister Bezalel Smotrich responded: "We were not frightened when the rating was lowered, we believed in the Israeli economy, we managed it correctly, and we knew that with the victory in the war, the economy would also win, with God's help, and demonstrate extraordinary resilience.".
""We continue to say this today and are happy that finally the rating agencies understand that the miracle of the Israeli economy is unprecedented. The people of Israel are alive," Smotrich wrote in his X account.
