S&P Warns Australia AAA Rating at Risk From Election Pledges

S&P Global Ratings warned Australia’s prized AAA sovereign credit rating may be at risk if election campaign pledges result in larger structural deficits, debt and interest costs, highlighting fiscal pressures facing the next government.

“The budget is already regressing to moderate deficits as public spending hits post-war highs, global trade tensions intensify, and growth slows,” analysts Anthony Walker and Martin Foo wrote in a note on Monday. “How the elected government funds its campaign pledges and rising spending will be crucial for maintaining the rating.”