Moody's lowers HK's outlook to 'negative'

Local | 16 Sep 2019 7:15 pm

Credit rating agency, Moody's Investors Service, said today it has changed the outlook on the Aa2 issuer rating of the Government of Hong Kong from "stable" to "negative," but affirmed the Aa2 long-term issuer and senior unsecured ratings.

The change in outlook to "negative" reflects the rising risk that the ongoing protests reveal an erosion in the strength of the city's institutions, with lower government and policy effectiveness than it had previously assessed, and undermine Hong Kong's credit fundamentals by damaging its attractiveness as a trade and financial hub, Moody's explained.

"The affirmation of the Aa2 rating reflects, among other things, Hong Kong's strong fiscal and external buffers, with a minimal government debt burden, large fiscal reserves and ample foreign exchange reserves, all of which offer resilience to shocks and negative long-term trends," the credit rating agency said.

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