Reuters reports that ratings firm S&P raised New Zealand's sovereign credit ratings by a notch, saying the economy was on a quicker recovery path from the COVID-19 pandemic.

S&P raised New Zealand's foreign and local currency sovereign credit ratings by a notch to 'AA+/A-1+' and 'AAA/A-1+' respectively. The outlook was maintained at stable.

S&P said New Zealand is recovering quicker than most advanced economies because it has been able to contain the spread of COVID-19 better than most others.

"This provides us with better clarity over the extent of the pandemic's damage to the government's balance sheet. We now believe that the government's credit metrics can withstand potential damage from negative shocks to the economy...," S&P added.