MOSCOW (Sputnik) — Moody’s Investors Service has downgraded China’s credit rating to A1 from the previous Aa3 level, changing the outlook from negative to stable, a press release of the Service said on Wednesday.
"The downgrade reflects Moody's expectation that China's financial strength will erode somewhat over the coming years, with economy-wide debt continuing to rise as potential growth slows," the release said, adding that the stable outlook reflects the assessment of the risks as "balanced" at the A1 rating level.
"Economy-wide debt of the government, households and non-financial corporates will continue to rise, from 256% of GDP at the end of last year," the release added.
According to the release, the outlook was changed from negative to stable due to the assessment that China’s government will manage to "maintain economic, financial and social stability in the near term" due to the fact that the government controls parts of the economy and financial system.
China's economy has recently been experienced significant turmoil, with growth rates at record lows, an increasingly volatile stock market and the yuan sliding against other currencies. According to the official data, the country’s GDP increase in 2016 made 6.7 percent, which is the lowest in 26 years.