Skyscrapers in the financial district of Pudong in Shanghai. Photo: Reuters, Aly Song

Just as global investor sentiment toward China had begun to improve in recent weeks, credit rating agency Standard & Poor’s joined Moody’s in downgrading China’s sovereign credit rating from AA- minus to A- plus.

Moody’s made the same move in May, while Fitch did so in 2013. S&P also followed Moody’s in changing the outlook from negative to stable, reflecting some confidence in government efforts to reduce risk.

“The timing for the S&P downgrade is a little bit surprising to me,” UBS economist Wang Tao was quoted by the WSJ as saying. Indeed, it follows months of continued strong economic performance since the surprising Moody’s downgrade, and as investors are warming to the market after two years of skepticism.