Hours after Moody’s Investors Service downgraded China’s credit rating, the nation’s finance ministry hit back with a statement on its website saying the rating agency overestimated the economic difficulties the country faces while underestimating Beijing’s capability in reforms.
The Chinese government’s quick response marked a sharp contrast to a year earlier. At a conference in March 2016, China’s former finance minister Lou Jiwei said Beijing didn’t “care too much” about ratings from international agencies when asked about a previous Moody’s change of China’s credit rating outlook.
Moody’s surprised the market on Wednesday morning by downgrading China’s credit rating by one notch to A1 from Aa3, expecting further fragility in financial strength and increases in debt. It also changed the outlook for China to stable from negative.
