From the Star Ledger:
New Jersey’s credit rating has won two more upgrades from Wall Street’s major rating agencies, bringing the number of upgrades to three in just the past week and six since March 2022.
Moody’s Investor Service lifted the state’s rating one notch on April 6, and that was followed by upgrades from Fitch on Tuesday and S&P Global a day later. In statements announcing the upgrades, the three agencies cited full pension payments over the past two years, as well as record surpluses and efforts to pay down debt and avoid new borrowing.
All three announcements closely followed Gov. Phil Murphy’s $53.1 billion state budget proposal for the fiscal year that begins July 1, which he unveiled on February 28 to kick off four months of budget hearings and negotiations in the state Legislature.
New Jersey has received three credit rating upgrades in the past week, as ratings services note the state’s “resilient” fiscal position following years of downgrades which hampered the state’s borrowing power.
The most recent upgrade was from S&P Global Ratings, who upgraded its rating on New Jersey’s general obligation bonds from “A-” to “A” on Wednesday.
Fitch Ratings upgraded NJ’s Issuer Default Rating (IDR) to “A+” on Monday, and Moody’s Investor Services upgraded the state’s rating from “A2” to “A1” last week. These ratings measure the health of a state’s economy, as well as a state’s ability to pay its debts.
“The upgrades reflect better pension funding levels and improved structural balance, largely the result of an anticipated third consecutive year of full actuarial pension contributions in fiscal 2024,” said S&P Global Ratings credit analyst David Hitchcock in a news release.
The upgrades come as the state is preparing to issue more than $1 billion in bonds for school facilities construction projects, which Fitch assigned an “A” rating to. Also, this week, New Jersey state legislators began their review of Gov. Phil Murphy’s proposed $53.1 billion budget for the next fiscal year — which starts this July.