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Moodys Affirms Chinas A1 Rating; Outlook Revised to Stable
Recommend 9 Positive 9 Negative 8 |
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Moodys has affirmed Chinas A1 long-term local and foreign currency issuer ratings and senior unsecured ratings, as well as the (P)A1 foreign currency senior unsecured shelf rating, and revised the outlook to Stable from Negative. Moodys stated that the outlook revision to Stable reflects its assessment that Chinas economic and fiscal strength will be able to withstand persistent domestic challenges as well as trade and geopolitical pressures. Moodys noted that despite the continued weakness in the property sector and a potential slowdown in export growth, exports are expected to continue supporting relatively solid GDP growth. Moodys forecasts real GDP growth of 4.5% in 2026 and 4.2% in 2027, providing policy space to address structural challenges without significantly expanding policy support. The Stable outlook also reflects broadly unchanged expectations for Chinas fiscal trajectory. Government debt as a percentage of GDP is projected to rise from 68.5% in 2025 to 82.4% in 2027, and to exceed 90% by the end of the 2020s. This reflects ongoing fiscal support for the economy, as well as the assumption that local government debt will be incorporated into debt swap programs to stabilize local government liquidity risks. At the same time, growth resilience reduces the need for substantial additional fiscal stimulus in response to external uncertainties, which could otherwise exacerbate the weakening of the governments fiscal position. (ad/da) This article was automatically translated by AI, the Chinese version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. Auto-translated by AI AASTOCKS Financial News |
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