In a major setback to the Euro currency bloc, S&P announced ratings actions on 16 euro zone sovereigns. Standard & Poor’s Ratings Services cut the debt ratings of France and Austria to AA+ from triple-A. Malta, Slovakia and Slovenia were also downgraded by one notch. S&P lowered the ratings of Italy, Spain, Portugal and Cyprus by two notches. It has further indicated at least a one-in-three chance of a further downgrade in the next two years. Fitch and Moody's are yet to downgrade. However, S&P affirmed its long-term triple-A rating on Germany, with a stable outlook, and affirmed the long-term credit ratings of six others. As a fallout the German Chancellor gains more power in negotiations. May the German Authorities realise that the balance of payments crisis continues in the Eurozone and needs to be addressed before it is too late.
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