Moody's China outlook downgrade does not tally with facts

It is true that Chinese economy is slowing, but Moody's has undoubtedly exaggerated the difficulties facing it, said Gao Cheng, a researcher with National Institute of International Strategy, Chinese Academy of Social Sciences.

On the ability to carry out economic reforms, China has proved its ability to implement key reforms, Gao told Xinhua in an interview.

The Chinese government has shown a solid track record of intervening at the right time to stop risks from escalating out of control, she added.

Normally, the decision by a rating agency like Moody's to downgrade the sovereign credit rating or outlook of a major economy could spark a panic in that country and the wider region, Mei said.

However, market reactions in China and the wider Asia defied the decision. On Thursday, stock markets in most of Asia's major economies extended their gaining spell with the benchmark Shanghai Composite Index rising 0.35 percent following a 4.26 percent-surge on Wednesday.

The currency market is also "calm," with the central parity rate of the currency yuan strengthened by 78 basis points to 6.5412 against the US dollar on Thursday.