How Does Canada Stack Up Against Other 'AAA' Rated Sovereigns?

S&P Global Ratings' 'AAA' rating places Canada in an exclusive group of sovereigns. Of the 136 sovereign governments that we rate as of June 30, 2021, only 11 are in the 'AAA' category, which is our highest rating. The group of sovereigns rated 'AAA' has shrunk over time; almost a decade ago, 16 sovereigns were rated 'AAA' (table 1). Strong institutions and a track record of sustainable public finances lend credibility to the federal government's plan to wind down spending, and underpinned our recent decision to affirm our 'AAA' rating on Canada (see "Canada Ratings Affirmed at ?AAA/A-1+'; Outlook Remains Stable," published April 26, 2021, on RatingsDirect). Canada used its considerable fiscal and monetary policy flexibility to respond to the

...- Even after accounting for the federal government's comparatively large fiscal response to the COVID-19 pandemic, we expect Canada's creditworthiness will remain well positioned in the middle of the pack of '###' rated sovereigns. - Canada's stable and resilient institutions, wealthy and diversified economy, credible and effective monetary policy, and net external asset position will continue to stack up well against those of many other '###' rated sovereigns, despite the country's comparatively weaker fiscal profile. - The notable deterioration in Canada's fiscal accounts and the significant increase in debt will merit increased focus, including examining the evolution of these factors at the provincial level, as we incorporate local and regional governments into our general government metrics. S&P Global Ratings' '###' rating places Canada in an exclusive group of sovereigns. Of the 136 sovereign governments that we rate as of June 30, 2021, only 11 are in the '###' category, which is...

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