Global Courant
ISTANBUL
Fitch Ratings confirmed on Thursday that Canada’s long-term currency rating is “AA+” and the outlook is stable.
Canada’s ratings reflect a macroeconomic policy framework that ensures strong governance, high per capita incomes, stable growth and generally low inflation, in addition to falling public debt burdens, the agency said.
The general government fiscal deficit, reflecting the withdrawal of pandemic support at the federal level and rising revenues amid strong nominal GDP growth and commodity prices, fell to 0.7% of GDP in 2022 from a peak of 11.3% in 2020. a phrase.
However, he added that there are downside risks to Canada, such as the introduction of green energy subsidies to compete with US green energy tax credits, continued demands for higher spending, and wage pressures caused by high inflation.
While high interest rates are driving up debt servicing costs for many mortgage holders, household mortgage defaults have been doing well so far at historic lows. But Fitch warned that this could be tested by further increases in interest rates.
The Bank of Canada increased interest rates by 25 basis points on Wednesday after it announced that it was continuing its monetary tightening policy. The overnight interest target was increased to 4.75%, the bank rate increased to 5% and the deposit rate to 4.75%.
Canada’s annual consumer inflation fell to 4.3% in March after rising 5.2% year-on-year in January, but rose to 4.4% in April, according to the latest figures from Statistics Canada.
However, figures show that it has slowed significantly from an annual increase of 8.1% in June 2022, a 39-year high.
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