The Albanese government's first budget is unlikely to add to inflation pressures, two major credit ratings agencies say.
S&P Global Ratings has had a AAA rating on Australia since February 2003, and the outlook was revised back to stable after being cut to negative in June last year.
"We believe the budget won't greatly add to inflationary pressures," S&P director Anthony Walker said.
The budget shelved some coalition government programs and limited new spending in the near future without putting in place any large cost of living initiatives.
"We believe stage three income tax cuts (legislated to come into force in 2024) will not add to inflationary pressure. They will commence while the economy will likely be slowing," Mr Walker said.
Moody's, which has an AAA credit rating with a stable outlook on Australia, said the 2022/23 budget was a positive step toward repairing the deficit despite the challenges presented by high government debt.
But with revenue forecast to wane in the years ahead, the government will need to manage big-spending programs such as the NDIS.
"In this context of substantial long-term spending pressures and higher costs of debt servicing, lifting Australia's relatively weak productivity performance will be critical to the fiscal repair supporting Australia's credit outlook," Moody's Investors Service vice president Martin Petch said.
S&P said rising debt levels and interest payments did not present a risk to its rating on Australia as the nation's net debt of 30 to 35 per cent of gross domestic product was comparable to that of similarly rated peers.
The agency also noted a correction in house prices - of about 6.5 per cent since early May - should alleviate risks of a possible sharp fall and consequent blow to the economy and financial system.
The key risks to the S&P AAA rating lay in the global economic headwinds, the Russia-Ukraine conflict and a sharp fall in commodity prices.
Strong economic conditions and higher inflation were delivering higher tax revenues which would cover spending on social welfare, disability services, health, defence and a rising interest bill on national debt.
