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Moody's Upgrades Hong Kong's Currency Rating
Rating agency Moody's Investor Service has upgraded Hong Kong's short-term foreign currency country ceiling to Prime-1 from Prime-2, and the domestic currency issuer rating of the government to Aa3 from A1.
The move will mean access to cheaper short-term foreign currency funding for many Hong Kong companies, according to local media reports Friday.
However, the agency left Hong Kong's key long-term sovereign rating untouched at A3, which will continue to penalize issuers of public and private sector foreign currency bonds.
The upgrades reflected Hong Kong's "successful navigation through the highly stressful period of the East Asian and post-Russian financial crisis, and the continued robustness of both its fiscal and external positions," the sources said.
Moody's also predicted the real estate sector would remain "an integral part" of the regional economy, despite the effects of the Asian economic crisis.
All of the Moody's-rated real estate development and management companies in East Asia have maintained their investment grade ratings.
Donald Tsang, financial secretary of Hong Kong, welcomed the upgrade but said it was only achieved after long talks between the government and various credit-rating agencies.
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