Fitch Ratings is poised to cut growth estimates for Asian nations as Europe’s debt crisis weighs on the outlook for the world economy.
Quarterly predictions due to be released by the company “shortly” will have downgrades for growth estimates for Asian countries, Andrew Colquhoun, the company’s Hong Kong-based head of Asia-Pacific Sovereigns, said in an interview with Bloomberg Television yesterday.
China’s economy, the biggest in Asia, is cooling as demand for exports weakens and the government prolongs a crackdown on property speculation. Growth in overseas shipments last month was the weakest since 2009, excluding seasonal distortions, and the trade surplus shrank from a year earlier, customs data showed on Saturday.
Colquhoun didn’t give any specific estimates for growth.
Asian stocks advanced yesterday, snapping a two-day losing streak on the region’s benchmark index, after US consumer confidence topped estimates and European leaders agreed tighter budget rules and to add 200 billion euros ($266 billion) to the euro crisis war chest.
The MSCI Asia Pacific Index gained 1 percent as of 10:03am in Tokyo yesterday. The gauge dropped 2.2 percent last week after Standard & Poor’s said it may cut credit ratings for Germany, France and 13 other euro-area countries amid a deepening debt crisis.
Separately, Moody’s Investors Service said it will review the ratings of all EU countries in the first quarter of next year because last week’s EU summit failed to produce “decisive policy measures” to end the region’s debt crisis.
At the summit, euro-region leaders agreed to a fiscal accord to create more oversight of budget policies and create automatic penalties for countries violating deficit rules.
The accord “underlines the continued desire among euro-area politicians to move toward centralised fiscal coordination and mutualisation of resources and risks,” Moody’s said in an e-mailed statement yesterday.
“However, Moody’s believes that the announcement offers few new measures and points out that many are similar to previously announced ones,” it said.