NXJ - Moody's upgrades New Jersey issuer rating to A1; outlook stable

2023-04-06 17:18:45 ET

Moody's Investors Service upgrade on Thursday the state of New Jersey's issuer rating to A1 from A2, both investment-grade rankings. A1 is the fifth highest rating in Moody's credit rating scale. Outlook is stable

The upgrade incorporates a "solid economic recovery, with job gains leading the region and driving employment above the state's pre-pandemic peak," Moody's said in a statement.

The state's comitment to full, actuarial pension contributions through fiscal 2024, which starts on July 1, 2023, and its additional allocations of funds to a program to defease debt and cash-fund capital projects also supported the ratings action.

"An unprecedented level of budgetary surplus should position the state to respond to any economic dislocations caused by rising interest rates or other near-term conditions, while also maintaining the commitment to diligent long-term liability management," Moody's said.

However, the state "remains subject to long-term liability and fixed-cost burdens much more substantial than those of most other states," it added .

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