On April 26, 2016 the Moody’s Investor Services posted a new rating, Aa2, for the Province of Ontario and revised the economic outlook from negative to stable. This signals that Ontario’s debt burden will modestly improve as the province moves further with balanced budgets. The perceived increase of uncertainty about the province’s ability to control its collecting-spending after the 2008-2009 financial crisis seems to be over.
The Aa2 rating suggests an increased confidence in the success of the province’s economic strategy for the short and medium terms. Despite an increasing total debt in short and medium terms, a better debt-revenue balance is foreseen within the recently proposed budget and economic strategy.
In response to this third party assessment, Ontario’s Ministry of Finance recommends an adjustment to the prior provincial forecasts. The recently updated national economic accounts’ results for the last quarter of 2015 led to a yearly economic growth of 2.6 percent. In the meantime, other forecasting institutions already changed their provincial outlooks: e.g. University of Toronto posted 3.1 percent economic growth for 2016 and 2.8 percent for 2017.
This third party assessment brings optimism for stronger economic growth and job creation in Ontario in the short and medium time horizons.