S&P Head Says Fundamentals Need to Improve in Europe

June 24, 2014 Share Print 0

S&P’s head of sovereign ratings for Europe, Middle East and Africa, Moritz Kraemer, told Reuters in an interview that he saw a “calm period ahead” for ratings actions in Europe.

“Much of the homework still needs to be done. The over-indebtedness in a very low inflation environment poses huge risks to the growth outlook for the euro zone,” he said on the sidelines of a conference in London.

“There is no need to raise the ratings until the (economic) fundamentals improve.”

Kraemer said the countries that had made most progress in cutting debts included Ireland and Spain, and both had seen their ratings upgraded.

S&P raised Ireland by one notch to A-minus earlier this month, citing its brighter economic outlook

Last month, the agency raised Spain by one notch to triple-B on similar grounds.

Kraemer said the return to debt markets of Cyprus, which was bailed out just a year ago, and Greece had little impact on their ratings.

via Reuters

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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.