Credit rating agency anticipates ‘resilient’ Florida economy to outpace U.S. inflation

TALLAHASSEE, Fla. (FLV) – Fitch Ratings recently affirmed Florida’s AAA credit rating, the highest achievable among the credit rating organization.

The U.S. was downgraded to AA+.

In Fitch’s full report, the company expressed an optimistic outlook for the Sunshine State’s financial situation.

The group gave multiple reasons for handing Florida the best credit rating, one being the state’s “continued economic and population growth,” which Fitch said is a prime factor in their assessment that Florida’s revenue will outpace U.S. inflation over time.

Other actions cited include tax cuts for things like baby and toddler products, approving raises for state employees, investing in local preservation, accelerating infrastructure improvements and more.

“Today’s announcement reinforces that Florida’s track record of conservative policy, early debt repayment, and strong reserves is the blueprint for states and the federal government to follow,” DeSantis said when Fitch released this year’s rating for Florida.

“As excessive spending and irresponsible governance ballooned our nation’s debt to detriment to its credit rating, Florida remains the standard-bearer for smart fiscal policy,” the governor continued.

In the report, Fitch said Florida witnessed a speedy recovery from the coronavirus pandemic’s economic woes, noting that post-pandemic, Florida’s revenue growth was “well above initial forecasts” thanks to a “longer and stronger than expected economic recovery.”

“Florida has consistently demonstrated sound financial operations acting to balance budgets and rebuild and maintain sound levels of reserves (general fund, BSF, and various trust funds) through economic cycles,” Fitch also said.

Fitch reported that Florida’s high levels of reserves is an example of the state’s “robust fiscal resilience.”

On the Sunshine State’s overall economic growth, Fitch said job growth has been “robust in recent years,” along with unemployment recovering to pre-pandemic levels.

Last week, DeSantis’ office released July’s economic report for Florida, which had its private sector grow five times faster than the national average.

”For the last four years, Florida has led the nation with more than 2.5 million new businesses formations and over 1 million Floridians joining the workforce,” DeSantis said of the economic numbers last week.

“Florida’s success is the direct result of freedom first policies that support business owners and job seekers along with record investments in workforce education and infrastructure that spur economic growth.”