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Fitch Cuts China's 2022 GDP Forecast on COVID Hit

People line up for PCR tests in Bejing, China. Reuters
People line up for PCR tests in Bejing, China. Reuters
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Fitch Cuts China's 2022 GDP Forecast on COVID Hit

People line up for PCR tests in Bejing, China. Reuters
People line up for PCR tests in Bejing, China. Reuters

Fitch said on Tuesday it has cut China's GDP growth forecast for 2022 to 4.3% from 4.8%, saying pandemic-related disruptions have had an impact on the country's economy in the first two quarters of the year.

The rating agency said it stills expects a quarter-over-quarter GDP contraction in the second quarter, before the economy starts to recover.

Fitch raised its 2023 growth forecast for the country slightly higher to 5.2% from 5.1%.

Meanwhile, an official said at a press briefing on Tuesday Beijing will postpone school reopening for at least one week after the labor day holiday.

The date when schools can resume will be decided after studying the COVID situation in the city, Li Yi, spokesperson with Beijing municipal education commission, said.

Some of Shanghai's 25 million people came out for brief walks and grocery shopping after enduring more than a month under a COVID lockdown, while Beijing embarked on another round of mass testing to control a nascent outbreak.

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Moody's Upgrades Saudi Arabia's Credit Rating

Moody's indicated that the rating upgrade and stable outlook are results of the Kingdom's ongoing progress in economic diversification. Reuters
Moody's indicated that the rating upgrade and stable outlook are results of the Kingdom's ongoing progress in economic diversification. Reuters
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Moody's Upgrades Saudi Arabia's Credit Rating

Moody's indicated that the rating upgrade and stable outlook are results of the Kingdom's ongoing progress in economic diversification. Reuters
Moody's indicated that the rating upgrade and stable outlook are results of the Kingdom's ongoing progress in economic diversification. Reuters

The credit rating agency “Moody’s Ratings” upgraded Saudi Arabia’s credit rating to “Aa3” in local and foreign currency, with a “stable” outlook.
The agency indicated in its report that the rating upgrade and stable outlook are results of the Kingdom's ongoing progress in economic diversification and the robust growth of its non-oil sector. Over time, the advancements are expected to reduce Saudi Arabia’s exposure to oil market developments and long-term carbon transition on its economy and public finances.
The agency commended the Kingdom's financial planning within the fiscal space, emphasizing its commitment to prioritizing expenditure and enhancing the spending efficiency. Additionally, the government’s ongoing efforts to utilize available fiscal resources to diversify the economic base through transformative spending were highlighted as instrumental in supporting the sustainable development of the Kingdom's non-oil economy and maintaining a strong fiscal position.
In its report, the agency noted that the planning and commitment underpin its projection of a relatively stable fiscal deficit, which could range between 2%-3% of gross domestic product (GDP).
Moody's expected that the non-oil private-sector GDP of Saudi Arabia will expand by 4-5% in the coming years, positioning it among the highest in the Gulf Cooperation Council (GCC) region, an indication of continued progress in the diversification efforts reducing the Kingdom’s exposure to oil market developments.
In recent years, the Kingdom achieved multiple credit rating upgrades from global rating agencies. These advancements reflect the Kingdom's ongoing efforts toward economic transformation, supported by structural reforms and the adoption of fiscal policies that promote financial sustainability, enhance financial planning efficiency, and reinforce the Kingdom's strong and resilient fiscal position.