Mounting pressure on all EU sovereign ratings: Moody's
Moody's Investors Service said today the rapid escalation of the euro zone sovereign and banking crisis is threatening the credit standing of all European sovereigns.Updated: Nov 28, 2011 12:08 IST
Moody's Investors Service said on Monday the rapid escalation of the euro zone sovereign and banking crisis is threatening the credit standing of all European sovereigns.
"While Moody's central scenario remains that the euro area will be preserved without further widespread defaults, even this 'positive' scenario carries very negative rating implications in the interim period," the agency said in a report.
Moody's also noted the political impetus to implement an effective resolution plan may only emerge after a series of shocks, which may lead to more countries losing access to market funding and requiring a support programme.
"This would very likely cause those countries' ratings to be moved into speculative grade in view of the solvency tests that would likely be required and the burden-sharing that might be imposed if (as is likely) support were to be needed for a sustained period."
First Published: Nov 28, 2011 12:04 IST