Says the increase in economy's overall leverage in context of adherence to ambitious GDP growth raises potential for economic and financial shocks
- Affirms China at 'A+'; outlook stable
- Country ceiling is affirmed at 'A+'
- Expects official aggregate financing (excluding equity) will rise to 208% of GDP in 2017, from 201% in 2016 and 114% in 2008
- Potential remains for capital outflow pressures to resume, especially in context of a strengthening US dollar
- Broader credit measure, which incorporates activity not directly captured in official series, will rise to around 270% at end-2017
- Fitch forecasts general government gross debt of 48.3% at end-2017, up marginally from a year prior
- Public finances remain a neutral rating factor
- Tighter monetary conditions may lead to slower GDP growth, which in Fitch's baseline forecast will decelerate to 5.9% in 2018, from 6.5% in 2017
- Sovereign net foreign assets (SNFA) will decline to 28.9% of GDP at end-2017, down modestly from 29.8% in 2016
- Says China's ratings are underpinned by the strength of its external finances and macroeconomic track record
- Near-term growth prospects remain favourable
Headlines via Reuters
I bolded Fitch's GDP forecast for emphasis
