(The Center Square) – Arizona now has a positive credit outlook, which means the state continues to be on good economic footing.
S&P Global Ratings upgraded the Grand Canyon State’s outlook from “stable” to “positive” citing the state’s economy on the rise and keeping its AA issuer credit rating. According to a press release, that means there’s a “one-in-three” that the rating could increase “over the next two years.”
“The positive outlook reflects our view that strengthening reserves and ongoing revenue and expenditure management, supported by strong economic momentum that we expect will continue, could lead to upward rating potential should the state also demonstrate budgetary discipline that helps to mitigate future cyclical pressures on its finances.,” S&P Global Ratings credit analyst Savannah Gilmore said in a statement.
Arizona is considered one of the fastest-growing states in the country in terms of both populations and businesses, particularly in Maricopa County.
“This report reaffirms that Arizona’s economic position remains strong and our future remains bright,” Hobbs said in a statement. “We are building an Arizona that lifts up the middle class, supports smart and sustainable business growth, and leverages the endless opportunities our state has to offer. The results are undeniable, and I will keep working every day to make sure all Arizonans continue to benefit from our booming economy.”
The announcement came as welcomed news to the Arizona Chamber of Commerce and Industry.
“The S&P upgrade to Arizona’s credit rating outlook is a testament to our state’s strong economic performance,” the organization’s president and CEO Danny Seiden said in a statement. “Arizona’s population and gross state product are growing, personal incomes are rising, and our reserves are solid. This announcement shows that policy matters and Arizona is on the right track. We’ll continue to work with the Governor and state Legislature to advance policies that promote a healthy and competitive business environment.”
However, S&P Global warned that the outlook could be demoted back to “stable” if “one-time” fixes for state government budget deficits happen or the state cannot “maintain structural balance.” The state tackled a $1.4 billion shortfall with cuts across the board with a budget passed in June.
