Moody's postpones Israel's credit rating update amid ongoing Gaza war

Israeli credit rating evaluation delayed as Moody's monitors war and economic impact

Israel's credit rating remains unchanged - at least for now. The credit rating agency Moody's informed Accountant General Yehli Rotenberg on Friday evening that it does not plan to release a credit rating notice at the present time. The next scheduled publication date for a rating notice by the agency is approximately six months from now.
"Given the ongoing conflict, we will continue to assess the broader credit risk of recent hostilities and will update the market accordingly," said an executive at Moody's during a conversation with Calcalist. "We are constantly evaluating the situation's impact on the credit rating but have not made any changes at this stage."
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(Photo: Reuters)
Although the next scheduled date for a rating announcement is six months away, the agency is not obligated to wait until then for an announcement. Rating agencies can release announcements and make rating adjustments at any time, regardless of the official publication dates for semi-annual reports.
In the previous month, a Moody's delegation, led by Kathrin Muehlbronner, visited Israel for an extensive series of meetings in preparation for the semi-annual report.
Moody's has been one of the most critical agencies regarding recent political developments, and it has been proactive in this regard. Since Justice Minister Yariv Levin presented the judicial coup last January, Moody's has adjusted Israel's credit rating forecast from "positive" to "stable" in April of this year.
At the time, it also made stern comments about the direction of the current government. Given the recent developments, a challenging report was anticipated, and some even expected the rating forecast to be downgraded to a negative outlook.
It's worth noting that last month, members of the Moody's delegation who visited Israel met with Prime Minister Benjamin Netanyahu. During the meeting, they sought explanations about the continuation of the legislation and the negotiations for a compromise. Netanyahu assured them that the legislation's continuation would only occur with broad consensus and that the coalition would not have a majority in the committee for the selection of judges.
The delay in publishing a new report on Israel's credit rating by Moody's allows the company to evaluate the situation in Israel in light of the ongoing war, the government's conduct in the coming months, and the measures taken to stimulate the economy and assist struggling businesses.
It is also anticipated that Moody's will take into account the potential extension of the Governor of the Bank of Israel Prof. Amir Yaron's term. Any resumption of diplomatic contacts between Saudi Arabia and Israel to establish a peace agreement after the war may also influence the credit rating.