LINE

Text:AAAPrint
Economy

Moody's doesn't worry finance chief

1
2016-03-21 08:40Global Times Editor: Li Yan

Negative outlook unduly pessimistic: expert

Finance Minister Lou Jiwei on Sunday dismissed concerns over a recent move by U.S. credit rating agency Moody's to downgrade China's outlook, saying he does not particularly "care" about the move, news portal qq.com reported.

Moody's maintained its rating but downgraded its outlook on China's government credit rating to "negative" from "stable" on March 2, citing uncertainty over the authorities' capacity to implement economic reforms, rising government debt and falling reserves.

One day later, Moody's downgraded its outlook for 38 of China's State-owned enterprises to "negative." Most of those SOEs are in the power and railway industries.

The market response has been muted. The offshore yuan exchange rate has not weakened since the review was released, and global investors did not choose to short China, Lou was quoted by the qq.com report as saying at the China Development Forum in Beijing on Sunday.

The minister added that he understands there are some concerns by some agencies over China's local government debt, industry restructuring, overcapacity and high inventory, but noted that they sometimes don't have all the necessary information.

Liu Xuezhi, an analyst at the Bank of Communications, said although the Chinese economy faces downward pressure and rising risks during the process of cutting overcapacity and reducing inventory, a negative outlook is unduly pessimistic.

"China has the ability to maintain medium- to high-speed economic growth of at least 6.5 percent in the next few years. In the financial sector, indicators such as the bad loan ratio and (loan loss) provisions are within the controllable range," he told the Global Times on Sunday.

The fluctuation of the yuan against the dollar since the second half of 2015 was partly caused by expectations for a U.S.rate hike and then the fact that one actually occurred in December, which should be seen as an external factor, Liu said.

The offshore yuan was traded at 6.46 against the dollar after trading closed on Friday, according to sina.com.cn on Saturday.

Chinese credit rating agency Dagong Global Credit Rating Co has maintained its outlook on the nation's local- and foreign-currency credit ratings at "stable", domestic media reported on March 2.

According to a survey carried out on March 10 at JPMorgan's annual Global Markets Conference in Paris, China ranked as the top concern due to China's slowing growth and its impact on the global economy.

The impact of the refugee crisis in Europe was a close second, with Britain's possible exit from the EU in third.

The survey had 257 respondents.

  

Related news

MorePhoto

Most popular in 24h

MoreTop news

MoreVideo

News
Politics
Business
Society
Culture
Military
Sci-tech
Entertainment
Sports
Odd
Features
Biz
Economy
Travel
Travel News
Travel Types
Events
Food
Hotel
Bar & Club
Architecture
Gallery
Photo
CNS Photo
Video
Video
Learning Chinese
Learn About China
Social Chinese
Business Chinese
Buzz Words
Bilingual
Resources
ECNS Wire
Special Coverage
Infographics
Voices
LINE
Back to top Links | About Us | Jobs | Contact Us | Privacy Policy
Copyright ©1999-2018 Chinanews.com. All rights reserved.
Reproduction in whole or in part without permission is prohibited.