Fitch Ratings News

Fitch Ratings said in a note. Post the higher-than-anticipated tariffs imposed the US administration, the rating agency projected that US growth in 2025 is likely to be slower than the 1.7 per cent that it had projected in March. According to Fitch Ratings, tariff hikes will result in higher consumer prices and lower corporate profits in the US. «Higher prices will squeeze real wages, weighing on consumer spending, while lower profits and policy uncertainty will act as a drag on business investment,» Fitch said. «Upward pressure on goods prices from tariffs — in the context of a recent large jump in US households' medium-term inflation expectations — means the Fed is likely to become more cautious about further rate cuts in the near term.»

Fitch Ratings said Wednesday. While India's economic growth forecast for FY26 is unchanged at 6.5% from the December outlook, the projection for FY27 was revised upwards by 10 basis points to 6.3%. This fiscal year, India's GDP is anticipated to grow by 6.3%, the global rating agency said. Consumer spending will pick up pace in the coming two fiscals, albeit at a slower pace, it noted. The Indian economy gained momentum in the December quarter, expanding 6.2% from a seven-quarter low of 5.6% in the quarter before, led by improved consumer spending and higher government expenditure. The ratings agency forecasts growth of 7.1% in Q4 of FY25 and 6.8% in Q1 of FY26.

Subscribe to enjoy similar stories. Fitch Ratings may cut some Adani Group bond ratings to speculative territory after billionaire founder Gautam Adani was charged by the U.S. Justice Department in a bribery scheme.

Fitch Ratings noted that elevated interest rates in the US since 2023 have begun to show some effect on the labour market and demand. Adding to worries, the global rating agency said politics remains an area of high uncertainty, with geopolitical risks here to stay. The rating agency noted that signs of a slowdown in the US are evident in weak credit growth and slowing consumer spending. This trend is expected to continue in the second half of 2024, with real GDP growth decelerating, though likely remaining above recession territory.

Fitch Ratings on Friday said India's post-election budget confirms that the new administration remains committed to reducing the fiscal deficit for FY25 and FY26, despite demands of the coalition government. In the FY25 budget, the government has lowered the Centre's fiscal deficit target for the year ending March 2025 to 4.9 per cent of GDP, from 5.1 per cent in February's interim budget.

fiscal deficit targets are achievable but the government's financial metrics still remain a weakness for the South Asian nation's credit profile compared to peers, an analyst at Fitch Ratings said on Tuesday. «Lowering of the deficit target to 4.9% from 5.1% of GDP is a clear signal of the government's commitment to deficit reduction,» Jeremy Zook, director — Asia sovereign ratings, told Reuters. «In our view, this seems relatively achievable.» During Tuesday's annual budget, India's government announced plans to spend $24 billion to create jobs over the next five years and $32 billion on rural development this year alone.

Fitch Ratings on Friday revised its outlook on domestic steel major Tata Steel to negative on account of uncertainty surrounding the turnaround of the company's operations in the UK. However, the expected robust growth in Tata Steel's India operations and likely earnings before interest, taxes, depreciation, and amortization (EBITDA) profits at Dutch operations in FY25, may offset any losses at UK operations, Fitch Ratings said in a report. «Fitch Ratings has revised the Outlook on India-based Tata Steel Limited's (TSL) Issuer Default Rating (IDR) to Negative, from Stable, and affirmed the IDR at 'BBB-'. »We have also affirmed the rating on the USD 1 billion notes due July 2024 issued by TSL's subsidiary ABJA Investment Co. Pte. Ltd. and guaranteed by TSL, at 'BBB-'," the statement said, adding that the negative outlook reflects uncertainty surrounding turnaround of the UK operations.

Greenko Mauritius, a subsidiary of Greenko Energy Holdings, has decided not to proceed with its planned dollar bond issuance that had sought to refinance a $425-million bank loan. The company, which is into renewable energy sources, will now seek alternative bank borrowing instead, Fitch Ratings said, while withdrawing the 'BB' rating assigned to the proposed bond. Initially, the proposed notes, rated 'BB' by Fitch and 'Ba2' by Moody's, were expected to price a 3.5-year bond under 7%. However, earlier this year, Greenko Mauritius deferred the bond due to interest rate volatility. The $425-million bridge loan remains outstanding and is due by September 30, 2024.

Fitch Ratings has raised India's growth forecast for FY25 to 7.2% from 7% earlier, on the back of elevated consumer confidence that is expected to drive spending and increased investments, but cautioned that the ongoing heatwave was a risk to both growth and inflation. In its Global Economic Outlook (GEO) released Monday, it raised its forecast for world growth in 2024 to 2.6% from 2.4% estimated earlier. India's economy grew 8.2% in FY24. «We expect the Indian economy to expand by a strong 7.2% in FY25 (an upward revision of 0.2pp from the March GEO),» Fitch Ratings said, adding that investment will continue to rise but more slowly than in recent quarters, while consumer spending will recover with elevated consumer confidence. Purchasing managers survey data point to continued growth at the start of the current financial year. Earlier this month, RBI had revised upwards the country's GDP forecast by 20bps to 7.2%. As per the report, signs of the coming monsoon season being more normal should support growth and make inflation less volatile, though a recent heatwave poses a risk. «We expect growth in later years to slow and approach our medium-term trend estimate,» it said.

EXIM Bank finances and facilitates India's international trade. Fitch Ratings said it has affirmed the bank's Long-Term IDR at 'BBB-' and its Government Support Rating (GSR) at 'bbb-'.

Girish Madan, Director, Fitch Ratings, says it would be a combination of both thermal and renewable generation sides. In renewables, wWe have seen some pressure on the earnings because tariffs were coming down as competitive intensity was increasing in the sector, but of late the profitability should increase because some of the variables have turned in favour of the Gencos. Some of the commodity prices have also come down. Plus, there has been a 20-30% correction in solar module prices. All these factors could lead to enhanced EBITDA generation as well as profitability for Gencos. Where exactly in the power basket are we seeing the highest amount of activity in terms of addition of capacities? Girish Madan: Over the last few years, we have seen a large part of capacity addition has happened in the renewable space. If we talk about the last two years, around 40 gigawatts have been added in India and 80% of that has gone into solar and wind capacities, mainly solar capacities, so that is where we have seen capacity addition happening. We have seen some volatilities as far as the demand was concerned before COVID, so there was a slowdown in capacity addition. But sustained demand over the last three years has led to a great increase in capacity addition.

Certain ECB officials have spent the month resisting market anticipations of interest rate reductions in the spring, emphasising the importance of waiting for first quarter wage data.

India's steel demand will likely slow in the next financial year beginning March as a mammoth general election will delay government projects and infrastructure spending, analysts and industry executives said. Steady government spending on infrastructure projects propelled India, the world's second-biggest crude steel producer, into one of the fastest-growing markets for the alloy globally, even as world demand slackened. But steel demand is expected to grow at a modest 7%-10% in the 2024-25 fiscal year, slower than a projected 11%-12% growth in the current year to March 2024, the analysts and industry executives said. Prime Minister Narendra Modi's ruling Bharatiya Janata Party will seek a third term in the next general elections due in early 2024. Staggered voting in India's general elections, the world's largest democratic exercise, takes place for weeks. «We expect finished steel consumption in India to increase by 9% in FY25, following a 12% rise in FY24,» Fitch Ratings said. But India would still remain the main growth market globally for steel, it said. Finished steel consumption hit a five-year high between April and October as construction activity picked up and the automobile sector showed robust demand. The construction sector grew 13.3% year-on-year in the July-September quarter and posted a 7.9% growth from the previous quarter to June 2023, the highest in five quarters.

Fitch Ratings' recent Global Economic Outlook (GEO) report anticipates a substantial decline in global growth to 2.1% in 2024, in contrast with the strong performance seen in 2023. The report from Fitch Ratings flags the resilience observed in global growth throughout 2023, propelled by China's consumption stabilisation and a revitalisation of growth in the United States.

By Huw Jones

Reserve Bank of India's recent decision that require banks and non-bank financial institutions to allocate more capital against unsecured consumer credit will constrain loan growth in the segment, according to a report. This should also reduce the potential for the rising appetite for such lending to weaken financial system stability, a report by Fitch Ratings said on Thursday.

Fitch highlighted that traditional and alternative investment managers face different challenges in the year ahead, particularly as growth continues to tighten.

Private-equity firms are being forced to spend more money to keep the companies they own alive, as rising interest rates disrupt the buyout industry’s debt-heavy playbook. With credit costs at the highest level in years, companies that provide debt for private-equity deals are asking firms to chip in additional equity when they look to refinance, say people who research the leveraged-finance markets and advise private-equity firms on transactions. Private-equity firms typically try to minimize their own equity investment when they buy companies, while maximizing leverage.

Israel-Hamas War LIVE Updates Also read: Day 14 Israel-Hamas War: Israel bombs historic church in Gaza | 10 updates "Israel's credit profile has proven resilient to terrorist attacks and military conflict in the past," it said. "However, the severity of the current military conflict raises the possibility of longer lasting and material credit impact," it added.

Pressure has remained on fees as competition increases, regulation tightens and value for money assessment require firms to demonstrate their prices are fair.

Fitch Ratings said today. The global rating agency left India's fiscal 2024 growth aim unchanged at 6.3% and also said the world economy in 2023 is likely to grow faster than estimated earlier. However, the agency said the deepening slump in China’s property market is casting a shadow over global growth prospects. Fitch raised its forecast for world growth in 2023 by 0.1 percentage point to 2.5%. «We have raised US growth by 0.8pp to 2.0%, Japan by 0.7pp to 2.0% and EM ex.