S&P cuts Spain’s credit rating by two notches to BBB+ … Standard & Poor’s cut Spain’s sovereign debt rating Thursday by two notches, warning that the government’s budget situation is worsening and that is likely to have to prop up its banks. S&P cut the country’s rating to BBB-plus and added a negative outlook, saying it expected the Spanish economy to shrink both this year and next, raising more challenges for the government. Esther Barranco, a spokeswoman for the Economy Ministry, told Reuters: “They haven’t taken into consideration the reforms put forward by the Spanish government, which will have a strong impact on Spain’s economic situation.” S&P also said that eurozone-wide polices were failing to boost confidence and stabilize capital flows, and that the region needed to find ways to directly support banks so that governments were not forced to take on those burdens themselves.” – UK Telegraph
Dominant Social Theme: It’s just a downgrade. Spain will bounce back.
Free-Market Analysis: Is Spain beginning to collapse and, perhaps, the EU with it?
- Mish/ Mike Shedlock – Spain Long-Term Debt Lowered To BBB+ From A, With Negative Outlook; 100% Certain Conditons In Spain Worsen – 27 April 2012 (lucas2012infos.wordpress.com)
- S&P slashes Spain’s debt rating (news.com.au)
- Spain in ‘crisis of huge proportions’ (business.financialpost.com)