Fitch reduces Alberta credit rating, cites concerns on heavy borrowing
Alberta's credit rating lowered to AA- from AA
Alberta's plan to relaunch its economy is taking a hit right out of the starting gate.
The United States-based Fitch rating agency has announced it's reducing Alberta's credit rating to AA- from AA.
Fitch cites a concern with sharply higher borrowing done by the province to deal with the economic fallout of the COVID-19 pandemic.
Premier Jason Kenney is expected to provide details of Alberta's financial picture in August, but has said this year's budget deficit is expected to balloon to about $20 billion from $7 billion.
On Monday, the premier announced an extra $1 billion in infrastructure spending on top of about another $9 billion in existing commitments to build roads, schools and health-care facilities to boost short-term employment.
His United Conservative government is also accelerating a cut to corporate income taxes, bringing the rate to eight per cent this week, in the hopes of attracting businesses to a province that has been hit by both the pandemic and a global oil price war.