Live updates: Follow the latest from Israel-Gaza
S&P Global Ratings downgraded Israel's credit rating amid the escalation of hostilities with its Middle East neighbours, the third such action from a major ratings agency in a span of less than two months, while also warning of a delayed economic recovery.
The country's long-term sovereign credit rating was lowered to “A” from “A+", with a negative outlook due to “heightened security risk”, New York-based S&P said on Tuesday.
The “A” rating is considered upper-medium investment grade and is five levels above junk status on S&P's ratings scale. An investment-grade rating makes it easier for a country to access capital markets and raise funding when it seeks to borrow.
S&P also expects the recovery in Israel's economy to be held back by the conflict, with real growth forecasts now also downgraded to 0 per cent for 2024 and 2.2 per cent for 2025, down from previous estimates of 0.5 per cent and 5 per cent, respectively, S&P said.
With S&P's move, the so-called big three ratings agencies have now all downgraded Israel's credit rating: Fitch Ratings and Moody's Investors Service made similar decisions in August and last week, respectively.
On Tuesday, Moody's downgraded the insurance financial strength rating (IFSR) to Baa1 from A3 on Clal Credit Insurance, one of the two largest credit insurers in the Israeli market and a subsidiary of Clal Insurance Company. The outlook was changed to negative from stable.
“We believe that, longer term, Israel's economy will be more durably weakened by the military conflict than expected earlier, leading to some pressure on Clal's profitability, asset quality and capital adequacy,” it said.
The agency also downgraded to Baa2 from Baa1 the long-term senior secured ratings of Israel Electric Corporation, which is almost completely owned by the Israeli government.
Along with its war in Gaza, which has been going on for nearly a year, Israel has launched a ground invasion against Hezbollah in southern Lebanon and has threatened to retaliate to Iran's Tuesday missile attack.
“We see an increasing likelihood that Israel's conflict with Hezbollah, given the recent escalation of fighting, becomes more protracted and intensifies, posing security risks for Israel,” analysts at S&P wrote in their report.
“We now consider that military activity in Gaza and an upsurge in fighting across Israel's northern border – including a ground incursion into Lebanon – could persist into 2025, with risks of retaliation against Israel. The latter in particular has been highlighted by a missile attack on Israel by Iran at the beginning of October.”
Israel's economy grew less than expected in the second quarter of this year. The country’s gross domestic product expanded by 1.2 per cent in the April-June period, the Central Bureau of Statistics said last month.
The conflicts Israel have been involved in reflect the risks to its growth, public finances and balance of payments, including direct security threats in case of retaliatory rocket attacks, the S&P analysts said.
“The negative outlook also reflects the risk of a more direct war with Iran, although this is not in our current base case,” they added.
S&P said its sees two near-term implications of the recent conflict escalation for Israel: increased risk from retaliatory rocket fire from Hezbollah, other Iran proxies in the region or Iran itself, and a broader economic impact of the recent escalation.
“Under these assumptions, we expect Israel's real GDP to stagnate in 2024. We anticipate that higher security threats will dampen consumer and investor confidence, while tourism, construction and agricultural sectors will remain affected.”
A wider ground operation in Lebanon requiring a call-up of reservists could also constrain economic recovery in the short term, they added.
S&P also projects that an increase in defence-related expenditure may result in a government deficit of 9 per cent of GDP for 2024, before slowing down to 6 per cent of GDP next year.
However, despite the risks, S&P's ratings on Israel remain supported by “several key strengths”, including the country's balance of payments and its “highly adaptable and diversified economy”, which has historically strong growth rates and rebounded quickly from crises.
Israel has “high per capita income levels, and we note that the economy's concentration on exports of high-tech services also provides for higher ability for some employees to work remotely, mitigating the impact of security disruptions on the domestic economy”, S&P said.
Timeline
2012-2015
The company offers payments/bribes to win key contracts in the Middle East
May 2017
The UK SFO officially opens investigation into Petrofac’s use of agents, corruption, and potential bribery to secure contracts
September 2021
Petrofac pleads guilty to seven counts of failing to prevent bribery under the UK Bribery Act
October 2021
Court fines Petrofac £77 million for bribery. Former executive receives a two-year suspended sentence
December 2024
Petrofac enters into comprehensive restructuring to strengthen the financial position of the group
May 2025
The High Court of England and Wales approves the company’s restructuring plan
July 2025
The Court of Appeal issues a judgment challenging parts of the restructuring plan
August 2025
Petrofac issues a business update to execute the restructuring and confirms it will appeal the Court of Appeal decision
October 2025
Petrofac loses a major TenneT offshore wind contract worth €13 billion. Holding company files for administration in the UK. Petrofac delisted from the London Stock Exchange
November 2025
180 Petrofac employees laid off in the UAE
The%20specs
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More on Quran memorisation:
Avatar: Fire and Ash
Director: James Cameron
Starring: Sam Worthington, Sigourney Weaver, Zoe Saldana
Rating: 4.5/5
If you go
The flights
Emirates and Etihad fly direct to Nairobi, with fares starting from Dh1,695. The resort can be reached from Nairobi via a 35-minute flight from Wilson Airport or Jomo Kenyatta International Airport, or by road, which takes at least three hours.
The rooms
Rooms at Fairmont Mount Kenya range from Dh1,870 per night for a deluxe room to Dh11,000 per night for the William Holden Cottage.
Afghanistan fixtures
- v Australia, today
- v Sri Lanka, Tuesday
- v New Zealand, Saturday,
- v South Africa, June 15
- v England, June 18
- v India, June 22
- v Bangladesh, June 24
- v Pakistan, June 29
- v West Indies, July 4
A%20MAN%20FROM%20MOTIHARI
%3Cp%3E%3Cstrong%3EAuthor%3A%20%3C%2Fstrong%3EAbdullah%20Khan%0D%3Cbr%3E%3Cstrong%3EPublisher%3A%20%3C%2Fstrong%3EPenguin%20Random%20House%3Cbr%3E%3Cstrong%3EPages%3A%20%3C%2Fstrong%3E304%0D%3Cbr%3E%3Cstrong%3EAvailable%3A%20%3C%2Fstrong%3ENow%0D%3Cbr%3E%3C%2Fp%3E%0A
Red flags
- Promises of high, fixed or 'guaranteed' returns.
- Unregulated structured products or complex investments often used to bypass traditional safeguards.
- Lack of clear information, vague language, no access to audited financials.
- Overseas companies targeting investors in other jurisdictions - this can make legal recovery difficult.
- Hard-selling tactics - creating urgency, offering 'exclusive' deals.
Courtesy: Carol Glynn, founder of Conscious Finance Coaching
Tour de France 2017: Stage 5
Vittel - La Planche de Belles Filles, 160.5km
It is a shorter stage, but one that will lead to a brutal uphill finish. This is the third visit in six editions since it was introduced to the race in 2012. Reigning champion Chris Froome won that race.
SPECS
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COMPANY%20PROFILE
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SPEC%20SHEET%3A%20APPLE%20IPHONE%2014%20PRO%20MAX
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SPEC%20SHEET
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COMPANY PROFILE
Name: Xpanceo
Started: 2018
Founders: Roman Axelrod, Valentyn Volkov
Based: Dubai, UAE
Industry: Smart contact lenses, augmented/virtual reality
Funding: $40 million
Investor: Opportunity Venture (Asia)
SHAITTAN
%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3EVikas%20Bahl%3Cbr%3E%3Cstrong%3EStarring%3A%20%3C%2Fstrong%3EAjay%20Devgn%2C%20R.%20Madhavan%2C%20Jyothika%2C%20Janaki%20Bodiwala%3Cbr%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E3%2F5%3C%2Fp%3E%0A
Essentials
The flights
Emirates flies direct from Dubai to Seattle from Dh6,755 return in economy and Dh24,775 in business class.
The cruise
UnCruise Adventures offers a variety of small-ship cruises in Alaska and around the world. A 14-day Alaska’s Inside Passage and San Juans Cruise from Seattle to Juneau or reverse costs from $4,695 (Dh17,246), including accommodation, food and most activities. Trips in 2019 start in April and run until September.