France loses another AAA rating with Moody's downgrade
@CNNMoney November 19, 2012: 10:08 PM ET
French President Francois Hollande is pushing for reforms amid a persistant eurozone debt crisis.
HONG KONG (CNNMoney) -- Moody's Investors Service has downgraded the credit rating of France, stripping a key eurozone economy of its prized AAA status.
The rating was cut one notch from AAA to Aa1. Moody's said its outlook remains negative, which means further downgrades are possible.
The downgrade follows a similar move by Standard & Poor's, which moved France off a AAA rating in January. Fitch is now the only ratings agency which gives French debt a AAA rating.
Moody's said its decision to downgrade is a result of France's structural economic challenges, including a rigid labor market. Economists see limited growth prospects for France as the eurozone crisis grinds on, and some have warned of disappointing results in future quarters.
The rating agency also cited the country's fiscal position and its exposure to eurozone shocks as a reason for the downgrade.
France's "exposure to peripheral Europe through its trade linkages and its banking system is disproportionately large, and its contingent obligations to support other euro area members have been increasing," Moody's said.
http://money.cnn.com/2012/11/19/news/economy/france-credit-downgrade-moodys/index.html?section=money_topstories
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