icon bookmark-bicon bookmarkicon cameraicon checkicon chevron downicon chevron lefticon chevron righticon chevron upicon closeicon v-compressicon downloadicon editicon v-expandicon fbicon fileicon filtericon flag ruicon full chevron downicon full chevron lefticon full chevron righticon full chevron upicon gpicon insicon mailicon moveicon-musicicon mutedicon nomutedicon okicon v-pauseicon v-playicon searchicon shareicon sign inicon sign upicon stepbackicon stepforicon swipe downicon tagicon tagsicon tgicon trashicon twicon vkicon yticon wticon fm

S&P strips France of Triple-A credit rating

Standard & Poor’s rating agency has downgraded the sterling AAA credit rating of Europe's second-largest economy, France to AA+. The rumors of a possible downgrade have been circulating since the end of the year.

A number of other countries have also been downgraded by the rating agency. The eurozone’s leading economy Germany has not been downgraded, even though it was one of the 15 eurozone countries put on a credit watch negative list by S&P in December. At the time, the agency said it was due to their increased credit risk.The euro has been falling over a month-long period, losing over 3 per cent against the dollar since December 13.Talks about a downgrade of EU countries has caused nervousness throughout European and international markets, often outweighing attempts by EU leaders to put a positive spin on the economy.Analysts say France’s downgrade has been expected because of the country’s extensive involvement in the European Central bank, as well as its role in bailing out Greece and Portugal. The ECB has made massive money injections to European economies in recent months. On Thursday, the ECB President said the strategy of battling Europe's debt crisis is starting to work.The move could weaken the country’s ability to borrow. France needs to find another 400 billion euro (US$506 billion) to stay afloat, covering its repayments of existing debt, interest owed and new borrowing. An extra 1 per cent would cost French taxpayers 4 billion euro a year.

Dear readers and commenters,

We have implemented a new engine for our comment section. We hope the transition goes smoothly for all of you. Unfortunately, the comments made before the change have been lost due to a technical problem. We are working on restoring them, and hoping to see you fill up the comment section with new ones. You should still be able to log in to comment using your social-media profiles, but if you signed up under an RT profile before, you are invited to create a new profile with the new commenting system.

Sorry for the inconvenience, and looking forward to your future comments,

RT Team.