From the Guardian – Ireland’s credit rating slashed five notches:
Moody’s downgrades Ireland’s credit rating and maintains ‘negative’ outlook on concerns cuts will hurt domestic demand…
Ireland’s credit rating has been slashed by five notches by Moody’s, which also warned that the country faced an increasingly uncertain economic future.
Moody’s said that the cost of rescuing Ireland’s banking sector meant Irish debt was now significantly riskier. It also expressed concern that the deep austerity cuts due over the next four years will hurt domestic demand…
The agency maintained a “negative” outlook on Ireland, and said that further downgrades are possible in the future.
Moody’s had previously rated Ireland as AA2 – the third highest level. Today’s downgrade to BAA1 leaves its sovereign credit rating just three places above “junk status”, and follows a similar move by fellow ratings agency Fitch last week.
“Ireland’s sovereign creditworthiness has suffered from the repeated crystallization of bank related contingent liabilities on the government’s balance sheet”, said Dietmar Hornung, the vice-president of Moody’s.