Moody’s Investors Service cut its outlook for Chinese sovereign bonds to ‘negative’, underscoring deepening global concerns about the level of debt in the world’s second-largest economy.

Moody’s lowered its outlook to ‘negative’ from stable while retaining a long-term rating of A1 on the nation’s sovereign bonds, according to a statement. China’s usage of fiscal stimulus to support local governments and state-owned companies is posing downside risks to the nation’s economy, the grader said.

The change in thinking comes as China’s deepening property rout triggers a shift toward fiscal stimulus, with the country ramping up its borrowing as a main measure to bolster its economy. That has raised concerns about the nation’s debt levels with Beijing on track for record bond issuance this year.

Moody’s last cut its credit rating on China in 2017, to A1 from Aa3, on the likelihood of a material rise in economy-wide debt and the impact that would have on state finances. That was its first China debt downgrade since 1989.

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