Moody’s keeps Aaa on Swedish gov’t debt

Sweden’s economic strength, high GDP per capita, resilient and diversified economy are all factors behind Moody’s decision to retain an Aaa rating in its latest annual report on the country.

“Healthy productivity gains, low wage and price inflation, and the country’s high-technology niche have bolstered competitiveness for more than a decade, leading to sizeable current account surpluses,” the rating agency notes.

Public finances are strong, with budget surplus targets eroding overall government debt in the past decade. The reforming of the pension system has reduced fiscal pressures that otherwise would have resulted from the aging population.

The country is resilient to event risk, with a solid banking sector. “Moody’s considers that there is a very low risk of bank contingent liabilities crystallising on the government’s balance sheet.”

Moody’s last rating change applied to Swedish sovereign debt came in April 2002, when it was raised from Aa1 to Aaa.

 

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