TORONTO, Jan 18 (Reuters) - Ratings agency Moody's cut its
outlook for Alberta to negative from stable on Monday while
affirming its Aaa rating, in the latest indication of the strain
that sinking oil prices have put on the Canadian province's
finances.
The decision came the same day oil prices slumped to a 2003
low below $28 per barrel. O/R
The negative outlook "reflects the rising risk that the
province's fiscal position will deteriorate further than
previously expected in an environment of protracted low oil
prices," the agency said in a statement.
"Without corrective fiscal action, this will lead to higher
than planned fiscal deficits and lower liquidity than forecasted
in the 2015/16 provincial budget."
Alberta's left-leaning New Democratic government in October
forecast it would post a C$6.1 billion ($4.20 billion) deficit
this fiscal year and borrow heavily to fund infrastructure.
Alberta Finance Minister Joe Ceci said in a statement the
government will carefully manage spending to ensure deficits do
not become unmanageable.
"All government spending programs are under review. There
are many important priorities that will have to wait until our
finances permit us to address them," he said.
"The Government of Alberta is limiting debt to 15 percent of
GDP (gross domestic product), half the average of Canadian
provinces."
($1 = 1.4538 Canadian dollars)
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Moody's statement on Alberta http://www.moodys.com/page/viewresearchdoc.aspx?docid=PR_342108&WT.mc_id=AM~UmV1dGVyc05ld3NfU0JfUmF0aW5nIE5ld3NfQWxs~20160118_PR_342108
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