Moody’s credit rating agency announced that it is considering downgrading several countries in Europe and has already cut the ratings for Italy, Malta, Portugal, Slovenia and Slovakia by one level. Spain was cut by two levels. This follows Standard and Poor’s downgrade of European countries over a month ago on January 13. S&P cut the ratings for France, Austria and Cypress. The Fitch credit rating agency also downgraded European counties in January.
Moody’s said that the downgrades were limited because of “the European authorities’ commitment to preserving the monetary union and implementing whatever reforms are needed to restore market confidence.” Germany’s economy is strong and that is helping greatly to strengthen the European Union. A managing director at Moody’s, Bart Oosterveld, forecast in an interview with Reuters, that should Greece withdraw from the European Union, there would be a “quite profound “effect on credit ratings and financial markets. Both Britain and France are under economic pressure abut they are making great efforts to prevent their economies from falling.
Unfortunately, Europe has been in economic decline for a few years and this is another step in Europe’s decline.