Global ratings agency Fitch has reaffirmed New South Wales’ Triple-A credit rating, maintaining a stable outlook for the State.
NSW remains the only Australian state to hold a Triple-A rating from Fitch.
Fitch cited the State’s strong economic fundamentals, including its large and highly diversified economy, resilient labour market and steady population growth.
The NSW Government said the decision highlighted ongoing improvements in the State Budget as it balances substantial infrastructure investment and demand for public services.
The Government has progressively reduced the Budget deficit and remains on track to return the Budget to surplus in 2027–28.
The 2026–27 NSW Budget forecasts:
- a $3.0 billion deficit for 2025–26;
- a $2.3 billion deficit for 2026–27; and
- a $1.1 billion surplus in 2027–28.
Further surpluses of $1.8 billion and $1.9 billion are forecast for the following two financial years.
The Government has also sought to constrain spending growth, with nominal expenses forecast to increase by an average of 2.7 per cent across the forward estimates.
Gross debt by June 2026 is $9.7 billion lower than the $188.2 billion projected in the 2023 Pre-election Budget Update, with gross debt projected at $178.5 billion.
The lower debt level is expected to save the State around $400 million a year in interest expenses.
The Government has also reduced its reliance on borrowing to fund infrastructure.
The State’s infrastructure investment program was estimated to be 83 per cent debt-funded in the 2022–23 Budget. Under the latest Budget projections, the proportion funded through borrowing is expected to fall to 53 per cent by the end of the forward estimates.
The NSW Government said it intends to continue managing debt while maintaining infrastructure investment and avoiding additional costs for households.
It also said its economic strategy remains focused on growing employment, wages and private-sector investment as households continue to face cost-of-living pressures.
NSW currently holds:
- Fitch: AAA, Stable outlook;
- Moody’s: Aaa, Stable outlook; and
- S&P Global: AA+, Negative outlook.