Italy denounces Standard and Poor's downgrade
The Italian government on Tuesday denounced a decision by Standard and Poor's ratings agency to downgrade the country's sovereign debt rating, suggesting that the move was in part inspired by political factors.
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The government released a statement saying that the Standard and Poor's decision appeared to have been "dictated more by newspaper backchat than by the reality on the ground, and it appears to have been clouded by political considerations".
On Monday the agency downgraded Italy's debt rating from "A+/A-1+" to "A/A-1" citing "Italy's weakening economic growth prospects." It added that Italy's weak governing coalition would "limit the government's ability to respond decisively " to events.
The agency also said the Italian authorities were reluctant to tackle the issues.
Italian stocks plunged at the start of the session on Tuesday and the euro fell against the dollar on Asian markets in the wake of the downgrade.
Eurozone members Greece, Ireland and Portugal have all needed EU-IMF bailout loans to avoid a debt default and there are fears that Spain and Italy are not too far behind.
If Italy runs into serious problems it would present a bigger threat because it is the zone's third-largest economy.
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