Moody’s warning shows Nicola’s Fudge isn’t so sweet after all

Moody’s has placed New Zealand’s credit rating on a negative outlook, underscoring growing concern about the Government’s worsening fiscal position.

Responding, Taxpayers’ Union spokesperson Tory Relf said:

“Minister Willis is right to say this is another warning that New Zealand can’t afford to simply spend more and borrow more. The problem is that is exactly what she is still doing.”

“Minister Willis got her first warning on 21 March this year when Fitch moved New Zealand to a negative outlook. Since then, government debt has grown by almost $2 billion and the National Debt Clock is forecast to hit $300 billion before the election. Where is the fiscal discipline Minister Willis talks about?

“Blaming global uncertainty is a convenient distraction for Minister Willis. Moody’s is pointing at Wellington. Despite the rhetoric, Government spending remains higher than under Grant Robertson, borrowing continues to climb, and there is no sign of a surplus this decade.”

“Credit rating agencies do not act on vibes. They follow the numbers. Being placed on negative watch is a signal to investors that New Zealand is becoming a riskier place to lend to, which ultimately means higher interest costs for taxpayers.”

“Clinging to the AAA rating while being put on negative watch is like celebrating while the warning lights are flashing. If this is what fiscal discipline looks like, it is no wonder Moody’s is losing confidence.”

“This must be a wake-up call ahead of Budget 2026. Until the Government matches its rhetoric with real spending restraint, more warnings, and eventually a downgrade, are inevitable.”