A combination of weak growth in advanced economies, persistent inflationary pressures, the Russia-Ukraine conflict, tight financial conditions, and a subdued growth outlook for China will create a difficult environment for emerging markets (EM) in 2023, said Moody's Investors Service.
The high food and energy prices will curb economic growth and result in social tensions in 2023 and hence the outlook for sovereign creditworthiness is negative, said Moody's Investors Service on Tuesday.
With gloomy global economic outlook, Moody's Investors Service turned moody on Friday and cut 2022 gross domestic product (GDP) projections for India to 7 per cent and projected 2023 at 4.8 per cent.
Of a select group of 27 middle-income sovereigns that Moody's rates globally, 13, including India and China, are clearly converging to high-income levels, said Moody's Investors Service on Thursday.
According to Moody's, the plan of Asia-Pacific (APAC) insurers to curtail or even cease underwriting and investment exposures to coal or coal-related industries are credit positive, although their coal exposures are generally small.
Moody's has said that India's real GDP may contract by 10.6 per cent in FY21.
The rating firm does not expect the regulators' action to materially affect the bank's existing business and financial profile.
The mounting debt will come on top of the already historically high sovereign and corporate debt levels in many advanced and emerging markets.
After pandemic-related shutdowns, production is now ramping up in the automotive and industrial sectors.
Auto unit sales will decline at least 30 per cent in 2020, following a decline of over 40 per cent in the seven months through July.
