Moody's cuts Ireland

Moody's Investors Service said it downgraded Ireland's foreign- and local-currency government bond ratings by one notch to Ba1 from Baa3.

The outlook remains negative.

The key driver for the rating action is the growing possibility that following the end of the current EU/IMF support program at year-end 2013 Ireland is likely to need further rounds of official financing before it can return to the private market and the increasing possibility that private sector creditor participation will be required as a precondition for such additional support, the agency said.

Although Moody's said it acknowledges that Ireland has shown a strong commitment to fiscal consolidation and has, to date, delivered on its program objectives, implementation risks remain significant, particularly in light of the continued weakness in the Irish economy.

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