NEW YORK (djc) – Moody’s Investors Service upgraded Canada’s foreign currency country ceilings for bonds and notes and for bank deposits to Aaa from Aa1. The agency also upgraded the rating of the Canadian government’s obligations in both foreign currency and Canadian dollars to Aaa.
In his statement to the media Canadian Finance Minister Paul Martin welcomed Moody’s Investors Service’s upgrade of Canada’s domestic and foreign currency debt rating to Aaa.
“This is a victory for all Canadians, who have made tough choices and sacrifices in our efforts to reinvigorate our economy and get our fiscal house in order,” Minister Martin said. “I am pleased that Moody’s has recognized Canada’s remarkable economic and fiscal turnaround over the past seven years.”
In making its announcement, Moody’s cited Canada’s improving fiscal situation and current account surplus, noting that the downward trend in our debt-to-GDP (gross domestic product) ratio and our foreign indebtedness “will continue over the long term.” It also noted that “the controversy surrounding constitutional questions relating to Quebec had diminished.”
Minister Martin noted that Canada’s improved fundamentals underpin the country’s robust economic recovery that is now underway. Canada’s economy is on track to post strong growth in the first quarter of 2002, and both the International Monetary Fund and Organisation for Economic Co-operation and Development predict Canada will post the strongest level of growth among G-7 countries this year and next. Moreover, Canada is the only G-7 country that expects to post a balanced budget this year.
The Minister also noted that employment growth in Canada has been among the best in the world. The Canadian economy has created more than 170,000 jobs in the first three months of this year.
“I am particularly pleased that Moody’s has recognized that our positive economic and fiscal trends will be sustained,” Minister Martin said. “We have come a long way together in the past several years, but we will not rest on our laurels.”
In connection with the government upgrade, Moody’s also upgraded the ratings of the Business Development Bank of Canada, the Canada Mortgage and Housing Corporation, Export Development Canada, Farm Credit Canada, Petro Canada Ltd., and Strait Crossing Finance, Inc.
