Fitch downgrades Italy to BBB

Fitch Ratings said it downgraded Italy's long-term foreign- and local-currency issuer default ratings to BBB from BBB+.

The outlooks are stable.

The issue ratings on Italy's senior unsecured foreign- and local-currency bonds were also downgraded to BBB from BBB+.

The country ceiling was revised down to AA from AA+.

The short-term foreign- and local-currency issuer default ratings and the issue ratings on Italy's short-term local-currency bonds were affirmed at F2.

“Italy's persistent track record of fiscal slippage, back-loading of consolidation, weak economic growth, and resulting failure to bring down the very high level of general government debt has left it more exposed to potential adverse shocks,” Fitch said in a news release.

This is compounded by an increase in political risk, and ongoing weakness in the banking sector which has required planned public intervention in three banks since December.”

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