Wednesday, March 24th, 2010
Portugal had its credit grade lowered one step to AA- by Fitch Ratings, which cited the nation’s deteriorating public finances.
The outlook on the rating remains “negative,” Fitch said in a statement today from London, meaning it’s more likely to cut the grade further than raise it or keep it unchanged.
“A sizeable fiscal shock against a backdrop of relative macroeconomic and structural weaknesses has reduced Portugal’s creditworthiness,” Douglas Renwick, associate director at Fitch, wrote in the report. “Although Portugal has not been disproportionately affected by the global downturn, prospects for economic recovery are weaker than 15 European Union peers, which will put pressure on its public finances over the medium term.”