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S&P Downgrades Italy’s Credit Rating

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Italy’s credit worthiness has been downgraded by the ratings agency S&P.

It said the continued weakness of the Italian economy was behind the cut, which saw the rating of government debt lowered to BBB from BBB+.

Italy, the eurozone’s third largest economy, has been in recession since the middle of 2011 and unemployment is currently running at more than 12%.

S&P said it expects the Italian economy to contract by 1.9% this year, much worse than its previous forecast.

The agency said that a lack of reform is partly to blame for Italy’s poor performance.

“In our view, the low growth stems in large part from rigidities in Italy’s labour and product markets,” S&P said in a statement.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza

@alfonso_forex

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