The Ministry of Finance announced that Moody’s Ratings conducted a periodic review of the United Arab Emirates’ credit rating as of 30 March 2026.
The agency reaffirmed the UAE’s rating at Aa2 with a stable outlook, reflecting sustained global confidence in the nation’s economic resilience and the effectiveness of its fiscal policies, even amidst regional geopolitical tensions.
Moody’s Justification
“The economy’s high per-capita income, robust institutions, and effective policymaking that underpin ongoing progress on economic diversification, and the federal government’s very low debt burden,” Moody’s said.
The review also emphasised the federal government’s low debt burden and robust financial position, enhanced by considerable fiscal reserves accrued from years of budget surpluses.
The Minister of State for Financial Affairs conveyed that the stable rating and outlook signal the UAE’s strong institutional framework and effective governance. The Minister noted that the country’s fiscal stability is underpinned by a consistent record of balanced budgets, which bolster resilience against evolving regional and global challenges.
The Minister asserted that the unchanged rating is indicative of the UAE’s solid fiscal fundamentals and sound economic policies, which prioritise diversification and sustainability.
GCC Growth Contraction
Yet growth is forecast to contract in FY26 ahead of the disruption to supply chains and investor sentiment albeit temporary.
GCC economies are forecast to slightly contract this year as recent regional escalations continue to weigh on economic activity, according to a new report by Oxford Economics and ICAEW.
ICAEW’s latest Economic Insight Q1 2026 report forecasts GCC GDP to contract by 0.2% in 2026, reflecting sustained disruption to energy trade, travel and investor sentiment.
However, the report also points to a strong recovery next year, with GCC GDP projected to expand by 8.5% in FY27.
S&P Follows Moody’s
Following this, S&P Global Ratings also affirmed the UAE’s sovereign rating at AA/A-1+ for both local and foreign currencies with a stable outlook, citing the government’s strong financial position and substantial reserves.
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