18 August 2003 Media Statement

Cullen welcomes AA plus from Fitch Ratings

Finance Minister Michael Cullen today welcomed the credit upgrade from British-owned rating agency, Fitch Ratings, saying it represented a solid endorsement of the government’s economic and fiscal management.

Fitch, the third of the ‘big three’ international rating agencies along with Standard and Poor’s and Moody’s, has up-graded New Zealand’s foreign-currency rating from AA to AA+, putting it on par with Standard and Poor’s but one step behind Moody’s AAA rating.

Fitch identifies three factors behind the decision: the economy’s increasing resilience to external shocks, sustained improvements in the public finances and a clear sense of private sector external debt risk management.

It notes that New Zealand recorded one of the highest growth rates in the OECD last year and says New Zealand’s track record of sound public finance has played a key role in cushioning the domestic economy from shifts in investor sentiment.

Looking ahead, it believes New Zealand should be well-placed to benefit from global recovery.

“This represents a strong vote of confidence in the policy direction of this government,” Dr Cullen said.

ENDS

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