Moody's has revised its outlook on New Zealand's AAA credit rating to negative from stable in a move that again signals a need for checks on spending and borrowing, Finance Minister Nicola Willis said Thursday following the ratings agency's outlook cut.
"Moody's choice to put New Zealand on negative watch is another warning that we can't afford to simply spend more and borrow more, or we risk higher interest rates, higher borrowing costs and more pressure on Kiwi families," Willis said.
In its decision, the ratings agency pointed to persistent inflation pressures, including fuel price hikes and higher electricity costs, as well as the country's delayed return to a budget surplus, according to media reports.
"The [outlook] revision also confirms the need for any support delivered in response to the Middle East conflict to be temporary and targeted," Willis said, adding that debt servicing now represents the fourth-largest cost to taxpayers.
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