OREANDA-NEWS. Positive pressure on ratings is ebbing, says Fitch Ratings in its 2015 Outlook for Emerging Asian Sovereigns. This follows a run of upgrades since 2011, the latest being Vietnam, which was raised to 'BB-'/Stable on 3 November 2014. Eight of 10 Emerging Asian sovereigns are on Stable Outlook, with two (Malaysia and Mongolia) on Negative Outlook. A deeper dive into credit profiles using Fitch Ratings' four main categories for analysis reveals marginally more negative than positive momentum.

Market volatility in December 2014 could be a foretaste of what is to come in 2015 as the US Federal Reserve moves towards raising interest rates while other major central banks may ease policy further. It was striking that the Emerging Asian markets should have been caught up in turbulence coming from Russia, as the region's direct links with Russia are few. These events show that Emerging Asia remains vulnerable to contagion from events elsewhere.

Nonetheless, Fitch expects real GDP in Emerging Asia, excluding China, to expand by about 6% in 2015 and 2016, remaining the world's fastest-growing region. We forecast China's GDP to expand at 6.8% in 2015 and 6.5% in 2016, as the government's bid to rebalance the economy works through. Lower oil prices and faster growth in advanced economies support most Emerging Asian countries, including China.