The rating agency this week said the city’s economy is likely to have contracted by 1.5 percent in 2019, lower than its earlier estimate of zero growth.

This week, Fitch said the city’s economy is likely to have contracted by 1.5 percent in 2019, cutting its forecast from an earlier estimate of zero growth. Hong Kong’s economic outlook continues to worsen as six months of street protests drove the local economy into a contraction, while persistent unrest puts the city’s business reputation and environment at risk said Fitch Ratings. 

«International perceptions of the intrinsic strengths of Hong Kong’s business environment are still at risk, which could eventually weaken its status,» said Stephen Schwartz and Andrew Fennell, Fitch’s sovereign analysts based in Hong Kong. «This suggests potential further downside risks to its credit rating.» 

Ratings Cut

Fitch in September cut its rating of Hong Kong-issued debt to “AA” with a “negative outlook”, from an earlier “AA+” rating with “stable outlook”, citing the negative impact of the ongoing protests. A “negative outlook” indicates a potential downward trend on its rating scale over a one to two-year period.

A negative or positive outlook, however, does not necessarily result in a rating change.