Beijing — S&P Global Ratings cut China’s sovereign credit rating by one step, to A+ from AA-, and revised its outlook to stable from negative. "China’s prolonged period of strong credit growth has increased its economic and financial risks," the agency said in a statement. "Although this credit growth had contributed to strong real GDP [gross domestic product] growth and higher asset prices, we believe it has also diminished financial stability to some extent." The downgrade, the second by a major ratings company this year, represents ebbing international confidence that China can strike a balance between maintaining economic growth and cleaning up its financial sector. The move may also be uncomfortable for Communist Party officials, who are just weeks away from their twice-a-decade leadership reshuffle. The cut will "have a relatively big impact on Chinese enterprises since corporate ratings can’t be higher than the sovereign rating," said Xia Le, an economist at Banco Bilbao Vizc...
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