MercoPress. South Atlantic News Agency
Fitch ratings downgrades China’s Yuan sovereign credit rating
Total credit in China could have reached 198% of GDP estimates Fitch Fitch Ratings has downgraded China's sovereign credit rating, warning about a credit build-up in the economy that could threaten the recovery. The agency cited “underlying structural weaknesses” and a growing risk from shadow banking. The downgrade is for Yuan-denominated debt, not foreign currency debt.
Some analysts have raised concerns over China's debt levels since 2009, when state-owned banks gave out a massive amount of loans to boost growth.
Fitch downgraded China's long-term local currency rating from AA- to A+, the first major international agency to cut China's sovereign credit rating since 1999.
It said total credit in China may have reached 198% of GDP at the end of 2012, up from 125% in 2008.
That includes a contribution from what is known as shadow banking, lending by non-bank institutions or bank credit that is kept off the books.
“The proliferation of other forms of credit beyond bank lending is a source of growing risk from a financial-stability perspective,” Fitch Ratings said.
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Read all commentsI imagine the communists will have their own rating agency put out a disclaimer.
Apr 10th, 2013 - 08:08 pm 0Well, that will clear matters up, won't it.
You can tell there is a monetary imbalance whenever poor contries have condos that are higher priced $/sqft than NYC. Same thing happened in BA and now San Paulo.
Apr 13th, 2013 - 05:47 pm 0It is unsupportable.
I think these Chinese are going to be very surprised and angry that they have lost 3 generations of savings on a bad real estate deal.
Very angry indeed.
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