British Columbia's Credit Rating Downgraded Again, Outlook Negative

British Columbia has received its fourth credit rating downgrade in four years, with S&P Global Ratings reducing its long-term issuer credit rating from 'AA-' to 'A+' due to persistent deficits and rapid debt accumulation projected through fiscal 2028. Moody's also downgraded the province's Baseline Credit Assessment from aa1 to aa2, citing structural deterioration characterized by larger deficits and higher debt levels driven by significant increases in both operating and capital spending. The province's projected deficit for the fiscal year 2025-26 is CAD14.3 billion, with further deficits expected in subsequent years, exacerbated by new federal immigration policies and trade uncertainties that are likely to hinder economic growth. The outlook remains negative, indicating a one-in-three chance of further downgrades if fiscal management does not improve. Observers note that this decline in creditworthiness contrasts sharply with the previous decade when the province experienced multiple upgrades. Overall, the situation underscores a widening fiscal imbalance and challenges in governance and risk management.