In an unexpected turn of events, credit rating agency Moody’s has postponed the release of Israel’s credit rating notice, leaving financial markets and stakeholders in suspense. This decision comes as a surprise to many, given that the agency had recently conducted a thorough assessment and even carried out a visit to Israel in preparation for the rating announcement. The sudden delay appears to be linked to the war with Hamas.
The official notification of the postponement was relayed to Israel’s Accountant General of the Ministry of Finance, Yehli Rotenberg, moments before the scheduled publication. While Moody’s had been poised to issue a rating, the eruption of the Israel-Hamas conflict appears to have compelled them to reconsider their evaluation.
The practical implication of this decision is that Israel’s credit rating will remain unchanged, currently standing at A1 with a stable outlook. The next anticipated date for the release of Israel’s credit rating notice by Moody’s will occur in approximately six months, according to the Ministry of Finance.
Moody’s had previously expressed concern over the ongoing situation, stating that “the effect of the military conflict between Israel and Hamas on the credit rating depends on the duration of the event and its regional scale.” This ambiguity surrounding the war’s consequences has clearly played a pivotal role in Moody’s decision to delay the rating announcement.
In recent months, Moody’s had also cautioned Israel against taking measures that could harm its credit rating. These warnings were issued in light of the potential repercussions stemming from the government’s legal reform initiatives. Among the three prominent credit rating agencies, Moody’s had been perceived as the most conservative in its assessments regarding Israel’s legislation. S&P, another major rating agency, is expected to release its rating announcement for Israel in the coming month, providing an alternative perspective on the nation’s creditworthiness.
It’s worth noting that Israel has maintained the same rating, A1, on the Moody’s scale for a remarkable 15 consecutive years, with the last upgrade occurring in 2008. Despite the postponement, Israel’s financial stability, as indicated by the credit rating, remains intact for now, though the ultimate impact of the ongoing conflict on the nation’s financial health is yet to be determined.