Ratings agency Moody's has warned that any sign the newly elected Turnbull government cannot progress budget consolidation measures through parliament would be seen as a negative for Australia's credit rating.
Moody's Investors Service said on Monday that trends in Australia's credit profile will be determined by whether fiscal objectives are effectively implemented, whether external financing conditions remain favourable, and how the housing market affects domestic growth and financial conditions.
Moody's said that if the split senate stands in the way of fiscal consolidation and macroeconomic policy measures, that would be "credit negative", but measures that would cut the budget deficit and stabilise government debt would be positive.
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