Spain Credit Rating was Reduced by S&P
Friday, April 27, 2012 6:56The rating agency Standard & Poor’s has cut Spain’s credit rating and warned of risks to come. S & P cut Spain by two notches to BBB + and warned that the country would have to more debt to support its banks. It has also put Spain on negative outlook, meaning there is a risk of further downgrades to come.
S & P forecasts the Spanish economy will shrink by 1.5% this year, having previously forecast 0.3% growth. In 2013, it expects the economy to shrink by 0.5%, having previously predicted 1% growth. S & P also gave a damning assessment of the situation in the rest of Europe, said: “From our perspective, the strategy to manage the European sovereign debt crisis continues to lack of efficacy.”
“We think credit conditions and hence the economic outlook for Spain, could worsen now more than we expected at the beginning of this year, unless offsetting euro-zone policies are implemented to support investor confidence and stabilize capital flows with the rest of the world. The Agency proposed that such measures could harmonize a pooling of resources and responsibilities between the countries of the euro area and policy, the wages of the currency bloc are.






