Business · Economy · 2 days ago
Fitch keeps Australia’s AAA rating but warns about high debt costs
Fitch has kept Australia’s top AAA sovereign credit rating and stable outlook.
It said the rating is supported by strong institutions, a resilient economy and the Australian dollar’s role as a reserve currency.
But Australia’s public debt and borrowing costs are high compared with those of other AAA-rated countries.
Fitch expects the economy to grow by 2.1% in 2026 and 2% in both 2027 and 2028.
It forecasts the government deficit will shrink and a primary surplus will return in 2027, while debt stays near 51% of economic output.
Fitch expects the central bank to keep its main interest rate at 4.6% throughout 2027, though it has not ruled out further increases.
The rating could face risks if efforts to control public finances fall short, growth slows for a prolonged period or households become less able to repay their debts.
Fitch reaffirmed Australia’s AAA sovereign credit rating and kept its outlook stable.
The agency said Australia’s institutions, economic resilience and reserve-currency status support the rating.
Fitch warned that public debt and financing costs are high compared with those of similarly rated countries.
It expects public debt to remain near 51% of GDP in 2027 and 2028, against a 39.5% median for AAA-rated peers.
Fitch cited insufficient fiscal consolidation, prolonged weak growth and worsening household repayment capacity as rating risks.
- Who
- Fitch Ratings.
- What
- It reaffirmed Australia’s AAA sovereign credit rating with a stable outlook, while warning about high debt and financing costs.
- When
- Friday, October 9, 2026.
- Where
- Australia.
- Why
- The rating is supported by strong institutions, economic resilience and the Australian dollar’s reserve-currency status; Fitch also identified fiscal and household-debt risks.
This story does not have two clearly opposing sides.
No direct quotes in the coverage so far.
This story does not have a timeline yet.
- Rating
- AAA, with a stable outlook
- GDP growth
- 2.1% in 2026; 2% in 2027 and 2028
- Public debt
- Near 51% of GDP in 2027 and 2028
- AAA peer debt median
- 39.5% of GDP
- Interest payments
- 6.9% of government revenue in 2027
- Household debt
- 178% of disposable income
Sources
Related news
Birdsville Track closure cuts off tourism and freight in the outback
ASX 200 set for higher open as oil and gold prices rise
Adidas sues Australian fashion label White Fox over four-stripe clothing design
Antares adds historic Enterprise gold mine to its Quinns project
Black Canyon to study development potential of Wandanya manganese project
HomeCo Daily Needs REIT units fall 35% from peak as forecast yield reaches 8%
TrivarX shifts focus to brain cancer imaging under new CEO
Three ASX tech firms pursue markets beyond their original focus
Canberra national security precinct will cost at least $1 billion
NRMA repays 400 NSW accident victims after miscalculating benefits
Argonaut remains optimistic on lithium despite recent price falls
