S&P places 15 European countries on watch

Standard & Poor's said it placed its long-term sovereign ratings on 15 members of the European Economic and Monetary Union on CreditWatch with negative implications.

The affected sovereigns are Austria, Belgium, Finland, France, Germany, Luxembourg, the Netherlands, Estonia, Ireland, Italy, Malta, Portugal, Slovak Republic, Slovenia and Spain.

The agency said it also maintained the CreditWatch negative status of its long-term rating on Cyprus and placed its short-term ratings on CreditWatch with negative implications.

The ratings on Greece have not been placed on CreditWatch.

S&P said the CreditWatch placements are prompted by the belief that systemic stresses in the euro zone have risen in recent weeks to the extent that they now put downward pressure on the credit standing of the euro zone as a whole.

The agency said it believes that these systemic stresses stem from five interrelated factors:

• Tightening credit conditions across the euro zone;

• Markedly higher risk premiums on a growing number of euro zone sovereigns, including some that are currently rated AAA;

• Continuing disagreements among European policy makers on how to tackle the immediate market confidence crisis and, longer term, how to ensure greater economic, financial, and fiscal convergence among euro zone members;

• High levels of government and household debt across a large area of the euro zone; and

• The rising risk of economic recession in the euro zone as a whole in 2012.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.