Rating cut puts Spain back on crisis radar
14 October 2011 @ 13:51
MADRID (Reuters) - Standard & Poor's cut Spain's credit rating on Friday, sending the euro briefly lower and underlining the challenges facing Europe's major powers as they meet G20 counterparts over the euro-zone debt crisis.
S&P, whose move mirrored that by fellow ratings agency Fitch last week, cited high unemployment, tightening credit and high private-sector debt among reasons for cutting the nation's long-term rating to AA- from AA.
Spanish 10-year government bond yields rose slightly in response, although they remained more than 60 basis points lower than those of Italy and, at 5.24 percent, some distance from the 7 percent level widely regarded as unsustainable.
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