Moody's reaffirms Israel's credit rating at A2 with negative outlook

International credit rating agency Moody's has reaffirmed Israel's credit rating at A2 with a negative outlook late on Friday.

The reaffirmation reflects the agency's stance that the current rating adequately represents the heightened geopolitical risks to which the country is exposed.

Moody's base scenario assumes the continuation of the war between Israel and Hamas, as well as ongoing tensions with Iran and its proxies, particularly Hezbollah.

Despite this, the risk remains tilted toward the negative, as indicated by the negative rating outlook. 

Specifically, there remains a significant risk of escalation into military conflict between Israel and Hezbollah or directly with Iran.