Prime Minister Benjamin Netanyahu on Saturday welcomed S&P affirming its Aa-/A-1+ credit rating and stable outlook for Israel, despite its warning that fallout from the government's contested judicial reform could hamper growth.
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"Maintaining Israel's positive rating during a globally challenging economic time is a vote of confidence in the right economic policy that we are leading," Netanyahu said in a joint statement with Finance Minister Bezalel Smotrich.
After plans by his ruling Coalition to limit Supreme Court powers sparked unprecedented protests in Israel, displeased Western allies and prompted dire economic warnings, Netanyahu in late March suspended the legislation to make way for negotiations with the Opposition. So far, talks have shown little sign of progress.
S&P said on Friday it expected domestic tensions to ease and a consensus to be reached. But the present uncertainty, it said, may weigh on growth, which it forecast at 1.5% for 2023.
Last month credit ratings agency Moody's downgraded its outlook for Israel, citing the judicial reform.
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