Moody’s may raise China’s bond rating
TEXT OF STORY
STEVE CHIOTAKIS: Moody’s says it’s taking a closer look at China’s government bond rating. The ratings agency says it could upgrade Chinese bonds sometime in the near future. And that’s certainly bucking the worldwide trend.
Marketplace’s China bureau chief Rob Schmitz reports.
ROB SCHMITZ: It’s sort of like a credit score for a country. And lately, government bond ratings elsewhere have been plummeting — Moody’s says Greek bonds are at “junk” status and there’s concern about Ireland’s debt. Not so for China. Moody’s may raise its rating to A1, just a few spots away from the coveted triple A rating.
Peking University Economist Michael Pettis says it’s a vote of confidence.
MICHAEL PETTIS: It says that people believe that China has grown a lot in the last couple of years and that it’ll continue to grow a lot in the next couple of years.
So now that they’ve got a higher credit rating, can I interest you in some Chinese government bonds? It’s actually not that easy. Foreigners technically aren’t allowed to invest in China’s domestic bond market. But that will soon change as Beijing begins a trial investment program for foreign banks.
In Shanghai, I’m Rob Schmitz for Marketplace.
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