moody's downgrades israel's rating again over war with hezbollah an international rating agency predicts that israel's already difficult economic situation will worsen due to ongoing fighting in gaza and a new conflict on the lebanese border. israel's economic rating has fallen from a2 to baa1 - and the agency made the decision even before the idf attacked hezbollah headquarters in beirut. this is the second time this year that israel's rating has been downgraded: in february, it was downgraded from a1 to a2 due to a nearly 20% reduction in the country's gdp. and by the end of next year, the costs that military conflicts will entail will amount to another 12% of gdp, according to israeli officials. however, the israeli finance ministry still believes that the country is doing well financially.
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