US rating agency Fitch confirmed its assessment of China and the world’s second largest economy will continue to be classified with a rating of A+ with stable outlook. A rating is the third highest, which Fitch provides and has prestigious investment grade.
The agency justified its decision with the strong macroeconomic performance of the Chinese economy, stable growth and continuous small unemployment rate. However, Fitch explains that there are some imbalances and vulnerabilities that could pose a risk to economic and financial stability. According to the assessment of agency vulnerabilities will increase in period 2016-2018. Fitch examines public finances as a neutral factor for the rating of China.
“The solid external finances of China and strong macroeconomic data continue to support the credit rating of the current level of A+”, said Fitch. .
Fitch Ratings continues to see strong evidence of continued structural rebalancing of China, including the fact that consumption generates more than two thirds of the total growth in the first three quarters of 2016. The services sector, another indicator by which to assess the progress on rebalancing, continues to grow rapidly.
Short-term prospects for growth in China is supported by the continued sustainability of investment in fixed income, retail sales and the labor market.
For the current year the agency expects economic growth of the Celestial Empire to be 6.7%t and next year’s expected GDP growth of 6.4%.
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