Thursday, November 24, 2011

Fitch cuts Portugal credit rating to junk status

Fitch Ratings on Thursday cut Portugal's sovereign credit rating to BB-plus from BBB-minus, putting the country's rating in junk status. The rating carries a negative outlook, which means a further cut is possible. "The country's large fiscal imbalances, high indebtedness across all sectors, and adverse macroeconomic outlook mean the sovereign's credit profile is no longer consistent with an investment-grade rating," Fitch said in a news release. The ratings firm said recession will make the government's deficit-cutting plan more challenging and will hurt bank asset quality, but that the government's commitment to the plan was "strong." The Portugal PSI 20 index is up 0.2% to 5,241.26, underperforming other European stock markets. source