International rating agency S&P downgrades Israel's credit rating from A+ to A with negative outlook amid escalation of the conflict in the country with the Shiite organization Hezbollah and the growing involvement of Iran in it, according to a message on the agency's website.
According to him, Israel's military operations in the Gaza Strip, as well as its limited ground operation in Lebanon and a missile strike by Iran will lead to a delay in the country's economic recovery.
In this regard, the agency adjusted the forecast for Israel's GDP growth from 0.5% to 0% in 2024 and from 5% to 2.2% in 2025.
S&P also forecasts an increase in the budget deficit in the short and medium term due to further increases in the country's defense spending.
Israel's credit rating could be revised down again in the next 24 months in the event of further escalation in the Middle East and Iran's direct involvement in the conflict, the report noted.