Home > Man-Made Disasters > Fitch Slices Spain and Italy Credit Ratings As EU Crisis Deepens, Moody’s Downgrades Nine Portuguese Banks

Fitch Slices Spain and Italy Credit Ratings As EU Crisis Deepens, Moody’s Downgrades Nine Portuguese Banks

“The ratings agencies are at it again. We have noted that the PIIGS will continue to see downgrades and that is what we are seeing today. Fitch downgraded both Italy and Spain. Shares of iShares MSCI Italy Index (NYSE: EWI) are still up 0.4% at $12.58 on the day but shares were up around $12.80 earlier today. Shares of iShares MSCI Spain Index (NYSE: EWP) are down only $0.02 at $33.65 but shares were above $34.00 earlier this morning.

Italy was cut to ‘A+’ from ‘AA-‘ today noting that the crisis is a significant financial and economic shock for Italy. It also notes that Italy has been hesitant to respond and it has eroded confidence.

Spain was downgraded to ‘AA-‘ with a negative outlook due to risks of fiscal consolidation efforts. It noted that it could go down to the ‘A-‘ range if the FROB costs are more than expected.” Read more.

Moody’s Downgrades Nine Portuguese Banks – “Moody’s Investors Service downgraded its ratings on nine Portuguese banks on Friday, citing the increased asset risk linked to their holdings of Portuguese government debt and the sovereign downgrade of Portugal in July. The ratings agency downgraded by one or two notches the senior debt and deposit ratings of nine banks and the standalone ratings of six of them. In early trading, Portugal’s top listed bank Millennium fell 1.7 percent.” Read more.

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