Thanks to foreign currency reserves totaling $120 billion as of July 2019, and Israel being a "net external creditor" nation, Israel is in a stronger position than the median in A-rated or AA-rated countries, economists from Fitch Ratings reported this week.
The company announced that it was confirming its A+ credit rating for Israel. According to Fitch economists, Israel has had an annual surplus on its external balance sheet every year since 2003, and that surplus is expected to remain in place for 2019-2020.
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Fitch economists estimate that renewed progress on reducing Israel's debt-to-GDP ratio or continued reduction to political and security dangers, will further improve Israel's credit rating.
However, the company warned, the credit rating could be affected if the public debt-GDP ratio continues to increase.
In August, financial services and credit rating agency Standard & Poor's reaffirmed Israel's global credit ratings and economic outlook, giving it an AA-score with a stable outlook.
S&P first upgraded Israel's rating to its current one – the highest rating awarded to the Jewish state to date – in August 2018, and reaffirmed it in February.
S&P noted it was not "overly concerned" by Israel's substantial fiscal deficit of 53 million shekels (roughly $15 million) – 3.8% of the gross domestic product, despite its exceeding the government's deficit goal of NIS 40 million ($11 million), or 2.9% of the GDP.
