Source: Business Insider
Moody’s cut Hong Kong’s credit rating from Aa2 to Aa3, citing the city’s lack of “effective response” to nine months of protests against China. The move by Moody’s follows an earlier downgrade from Fitch ratings in September last year. However, the ratings agency changed the outlook from negative to stable. Hong Kong has been embroiled in protests since June of last year, hurting the economy. Moody’s downgraded Hong Kong’s credit rating after it cited the absence of an “effective response” from the Hong Kong government to the ongoing protests. The rating was slashed from Aa2 to Aa3, Moody’s said in a statement on Monday. “The absence of tangible plans to address either the political or economic and social concerns of the Hong Kong population that have come to the fore in the past nine months may reflect weaker inherent institutional capacity than Moody’s had previously assessed,” Moody’s said, adding that Hong Kong also lacked “an effective response by Hong Kong’s executive and legislative branches of government to the concerns that have contributed to the ongoing protests, and the inertia which has increasingly characterised the legislative and executive branches.” However, the ratings agency changed the outlook from negative to stable, citing “superior fiscal strength and consistent macroeconomic stability” that is expected to continue through the period of heightened uncertainty in the region.