France’s AAA Outlook Cut

France’s credit outlook was lowered by Fitch Ratings, which also put the grades of nations including Spain and Italy on review for a downgrade, citing Europe’s failure to find a “comprehensive solution” to the debt crisis.

According to a statement released yesterday in London, Fitch affirmed France’s AAA rating and placed Spain, Italy, Belgium, Slovenia, Ireland and Cyprus on a “Rating Watch Negative” review, which it expects to complete by the end of January.

Meanwhile, Belgium's credit rating was cut two levels to Aa3 yesterday by Moody’s Investors Service.

The move by Fitch increases pressure on the region’s leaders to end a two-year debt crisis that has seen bailouts of Greece, Ireland and Portugal. European Union leaders meeting this month in Brussels agreed to forge a tighter fiscal union as the thrust of their efforts, even as the European Central Bank resisted investor calls to ramp up its bond-buying program.

S&P Action

Fitch’s action follows reviews announced by Standard & Poor’s and Moody’s. S&P on Dec. 5 placed the ratings of 15 euro nations on review for possible downgrade, including the region’s six AAA rated countries. Moody’s had said Dec. 12 it will review the ratings of all euro countries in the first quarter of 2012 because the Dec. 9 EU summit didn’t produce “decisive policy measures” to end the debt turmoil.
 (Bloomberg)