S&P To Downgrade Sovereign Credit Rating of France, Others
January 13, 2012
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Europe Update: S&P Downgrades France and Austria
The FT reports that S&P will downgrade the sovereign credit ratings of France and Austria. The rating of both countries has been cut to AA+ from AAA.
French government officials have confirmed that they have been notified of the downgrade by S&P. They also confirm that it is a one notch downgrade.
Recall that governments are usually given a warning prior to any downgrade by the independent rating agencies.
It is also being reported that Italy, Spain, and Portugal will see their debt ratings cut by two nothes.
Germany, Netherlands, Finland, and Luxembourg will note be downgraded.
S&P has declined comment so far. It is expected that the official downgrades will be issued this afternoon.
The primary issue involved with the downgrade of France is the potential impact the move could have on the ability for the EFSF and ESM bailout funds to raise money in the markets.
France is the second biggest economy in the Eurozone and a bilateral leader of the crisis, along with Germany.
Check back to this story as details will be included when available...
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