Fitch Ratings downgrades China's credit to 'Negative' as deficits 'erode fiscal buffers'

Transitioning to less property-reliant GDP

Fitch Ratings agency has downgraded China’s sovereign debt credit rating as the country contends with a major economic “transition”.

Fitch moved China's Long-Term Foreign-Currency Issuer Default Rating (IDR) from ‘Stable' to ‘Negative' due to "increasing risks to China's public finance outlook as the country contends with more uncertain economic prospects amid a transition away from property-reliant growth to what the government views as a more sustainable growth model". It said: "Wide fiscal deficits and rising government debt in recent years have eroded fiscal buffers from a ratings perspective." EFG's Afzal and Gerlach: A letter from Hong Kong According to Fitch, fiscal policy is "increasingly likely" to play...