Australia hails Moody's affirmation of AAA rating

Mining-driven Australia on Thursday hailed Moody's decision to affirm the country's triple-A credit rating, calling it a "resounding endorsement" of its recession-beating economic resilience. Treasurer Wayne Swan said the agency's praise of Australia's very low public debt and strong financial system showed the resources-rich country was well positioned to weather turbulence from the eurozone debt crisis. "Despite the substantial global headwinds that are hitting our economy, Australians have reason to be confident about our economic strengths that are unmatched by just about any other developed economy," Swan said. "At a time when other developed economies have had their ratings cut or put on review for potential downgrade, Australia stands tall in the world with its gold-plated AAA status safe and secure." The decision by Moody's comes after Fitch upgraded Canberra's credit rating to triple-A last month, meaning it was now seen as a top-flight economy by all three global agencies, including Standard & Poor's, Swan added. Moody's said Australia's economic diversity and strength of its financial system meant it was at "very low level of event risk", noting its key mining sector was matched by well developed manufacturing and services industries. "In comparison to most other AAA-rated countries, Australia's government financial strength is very high, with very low gross debt that is easily affordable and provides a high degree of fiscal flexibility," the agency said in a New York note overnight. Australia notched quarterly growth of 1.0 percent in the September quarter, following 1.4 percent in the three months to June. It briefly contracted in early 2011 after heavy flooding and cyclones hit mining and agriculture areas. The government was forced to scale back its budget forecasts this month after global economic turmoil hit revenues, but it has vowed a raft of spending cuts and savings to return to surplus in 2012-13. Australia was the only advanced economy to dodge recession during the global downturn due to the relative resilience of Asia -- a crucial market for its resources exports -- along with a series of government stimulus packages. The central bank cut the official interest rate by 25 basis points in November and again in December, to 4.25 percent, in a bid to stimulate the economy, with the global woes weighing on consumer and business confidence.