Moody's: Quebec strong

In its annual report on the Province of Quebec, Moody's Investors Service said the province's Aa2 debt rating reflects inherent credit strengths that include a large and diversified economy, a considerable amount of policy flexibility on budgetary outcomes enabled by its unfettered access to a broad range of taxes and its ability to adjust its expenditure base when necessary.

The rating also reflects an institutional framework that provides secure and predictable grants from the federal government, Moody's said, as well as a strong equalization mechanism.

The outlook is stable.

Quebec also is largely on track to meet the deficit targets in its plan to achieve a balanced budget in the next few years, the agency said.

The province's commitment to ease back on accumulating debt by lowering its cash requirements and contributing to a debt reserve fund is key to its stable outlook, Moody's added.

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