Zhou warns against trust in external ratings

Zhou Xiaochuan, the governor of the People's Bank of China, voiced concern about the role of rating agencies in an essay posted on the central bank's website.

"The global financial system relies heavily on the external credit ratings for investment decisions and risk management, giving rise to a prominent feature of pro-cyclicality," Zhou said.

The governor expressed concerns over the fact that the ratings industry was dominated by a few large players, who provided practically all of the most i