Bloomberg Anywhere Login


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Ontario Downgraded to Aa2 on Growing Debt Burden, Moody’s Says

April 26 (Bloomberg) -- Ontario’s credit rating was downgraded by Moody’s Investors Service as stalling economic growth puts its debt-reduction targets out of reach.

The rating was reduced to Aa2 from Aa1 and the outlook revised to stable from negative. The downgrade brings Moody’s assessment closer to Standard & Poor’s, which previously rated Ontario two steps lower.

“There are significant risks surrounding the province’s ability to achieve their medium-term fiscal targets and stabilize and then reverse the recent accumulation in debt,” Moody’s analyst Jennifer Wong said in a report.

Canada’s most populous province is struggling to contain a C$15.3 billion ($15.5 billion) budget shortfall by freezing public-sector wages and levying a 2 percent surtax on wage-earners of C$500,000 or more. Debt of C$257.5 billion is expected to peak at a record 42 percent of gross domestic product by 2015, according to Ontario’s budget released March 27. The ratio was 27 percent of GDP in 2007-08.

“Expense targets appear particularly ambitious” in light of the “subdued growth outlook,” Moody’s said. Health-care needs may swell with demographic pressures building on the province’s biggest expense item, according to the report.

The downgrade comes after Ontario’s outlook by S&P worsened yesterday. S&P put a negative outlook on its assessment, citing “challenging cost-containment targets in the next one-to-two years.” S&P rates the province at AA-, now a level lower than Moody’s.

To contact the reporter on this story: Cecile Gutscher in London at

To contact the editor responsible for this story: Dave Liedtka at

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.