Standard & Poor’s has affirmed Australia’s AAA credit rating, anticipating the government will reach compromises in getting its budget through the Senate.

The federal government may be frustrated by opposition to its first budget, but one major global credit rating agency appears more relaxed.

Standard & Poor’s has affirmed Australia’s AAA rating, saying the nation’s public finances remain strong with low debt and deficits.

According to S&P credit analyst Craig Michaels, a stable outlook is based on Australia’s historically conservative budgetary policies remaining in place so that deficits continue to narrow and government debt remains low.

Although many of the budget measures are yet to clear parliament, S&P expects compromises will be reached eventually.

It’s not the political rhetoric the government can use to persuade opposition parties to pass the budget, but it does mean Australia won’t be hit by higher borrowing costs as a result of a credit downgrade.

The government can also take some comfort from evidence consumers appear to be getting over Treasurer Joe Hockey’s first budget.

The latest ANZ-Roy Morgan consumer confidence has now completely retraced the sharp deterioration in the weeks around the May budget.

The bank’s chief economist Warren Hogan believes the impact of the budget has been temporary.

“The more enduring features of the economy, such as rising share and house prices, job creation and a stable world economy are now driving consumer attitudes to spending and finances,” he said.

Opposition Leader Bill Shorten, unsurprisingly, is not convinced.

“It is time for Tony Abbott to run up the white flag, declare defeat,” he told reporters in Melbourne.

He also took a swipe at the treasurer’s new biography.

“Leave the literary flights of fancy to people who are not as busy as you,” he said.

But Prime Minister Tony Abbott is supportive, saying Mr Hockey has a great story to tell about migrants who come to Australia from the Middle East.