Fitch Ratings has lowered its sovereign debt ratings on five Eurozone nations and retained its previous ratings on one. Here’s the list from the press release:
- Belgium LT IDR downgraded to ‘AA’ from ‘AA+’; Negative Outlook; ST IDR affirmed at ‘F1+’
- Cyprus LT IDR downgraded to ‘BBB-‘ from ‘BBB’; Negative Outlook; ST IDR affirmed at ‘F3’
- Ireland LT IDR affirmed at ‘BBB+’; Negative Outlook; ST IDR affirmed at ‘F2’
- Italy LT IDR downgraded to ‘A-‘ from ‘A+’; Negative Outlook; ST IDR downgraded to ‘F2’ from ‘F1’
- Slovenia LT IDR downgraded to ‘A’ from ‘AA-‘; Negative Outlook; ST IDR downgraded to ‘F1’ from ‘F1+’
- -Spain LT IDR downgraded ‘A’ from ‘AA-‘; Negative Outlook; ST IDR downgraded to ‘F1’ from ‘F1+’
The agency also outlined its reasoning for the changes:
Overall, today’s rating actions balance the marked deterioration in the economic outlook with both the substantive policy initiatives at the national level to address macro-financial and fiscal imbalances, and the initial success of the ECB’s three-year Long-Term Refinancing Operation in easing near-term sovereign and bank funding pressures. Nonetheless, the intensification of the eurozone crisis in the latter half of last year undermined the effectiveness of ECB monetary policy and highlighted the financing risks faced by eurozone sovereign governments in the absence of a credible financial firewall against contagion and self-fulfilling liquidity crises.
Fitch also offered details on each of its actions. The press releases are available here.
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