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Italy and Spain see rating downgrade by Fitch as France keeps triple A

Reuters/Alessandro Garofalo

Rating’s agency Fitch has downgraded five eurozone countries including Italy and Spain. Ireland maintained it triple B rating but joined France and Portugal on a ‘negative outlook’ meaning the country could suffer a downgrade. France is still rated triple A by the agency. 

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The agency said the moves reflected the risk that the crisis in the eurozone could further deepen.

Alongside Italy and Spain, Belgium, Slovenia and Cyprus were all downgraded as Fitch criticised the way European politicians were handling the Eurozone crisis.

“The eurozone crisis will only be resolved as and when there is broad economic recovery,” the agency said in a statement. “It is evident that further substantial reforms of the governance of the eurozone will be required to secure economic and financial stability.”

Dossier: Eurozone in crisis

It hit out at politician’s “gradualist approach” to systemic reform in the eurozone as Greece teeters on a debt default and financial turmoil stalls economic growth.

Italian Prime Minister Mario Monti said he took the news with “detached serenity” and they revealed things which were not particularly new.

On Tuesday, the International Monetary Fund, IMF, slashed its growth forecast for the single-currency area predicting a 0.5 per cent contraction for 2012.

 

 

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