Moody’s cuts China's credit outlook to negative on growing debt risks

Lallalit Srijandorn FXStreet

The credit rating agency Moody's cut its outlook on China’s sovereign credit rating to negative on Tuesday, citing the increasing risks to growth and a property sector crisis in the world’s second-largest economy, per Reuters.

Moody's downgraded China's A1 debt rating to "negative" from "stable" less than a month after lowering the US' remaining triple-A grade from a credit rating agency. This development sends a warning to lenders that the likelihood of a default has grown over the last year.

Market reaction

At the time of press, the AUD/USD pair was up 0.01% on the day at 0.6554.

Author

Lallalit Srijandorn

FXStreet

Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.

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