Moody's flags resilience in China economy, moves outlook to 'stable'

[BEIJING] Credit ratings agency Moody’s on Monday (Apr 27) revised China’s outlook to “stable” from “negative”, citing resilient economic and fiscal strength despite ongoing domestic pressures and challenges in trade and geopolitics.

The ratings agency said export growth is likely to moderate, but China’s competitiveness should cushion the slowdown, allowing GDP growth to ease only gradually.

China’s finance ministry said on Monday that it appreciated the agency’s decision to maintain China’s sovereign credit rating and upgrade its outlook, and vowed to further transform economic structure and enhance fiscal sustainability, according to a statement.

China’s industrial profits grew at their quickest pace in half a year last month, highlighting an uneven recovery with strong manufacturing but weak consumption, slowing exports and rising risks from higher costs and Middle East tensions.

Moody’s added that policies focused on high-productivity sectors and a controlled approach to resolving regional and local government debt would help improve capital efficiency, even as overall government debt rises. REUTERS