S&P piles pressure on Portugal with downgrade warning
STANDARD & Poor's today arned Portugal that it could cut its credit rating, placing it on a shorter-term negative outlook citing rising risks to the economy from its fiscal consolidation programme.
S&P put the BB sovereign foreign currency credit rating outlook on its CreditWatch negative list, meaning it will make a final decision within an approximate 90 day time frame.
"The CreditWatch placement reflects our view that there are rising risks to Portugal's ambitious fiscal consolidation objectives and an increased likelihood of noncompliance with the current EU/IMF program," the firm said in a statement.
"Risks include further challenges to fiscal and reform measures by Portugal's Constitutional Court, weaker-than-expected economic performance, and a resurgence of political tension leading to delays in 2014 budget or program reviews," S&P said.
Moody's Investors Service rates Portugal one notch lower at Ba3 with a negative outlook while Fitch Ratings has Portugal one notch higher than S&P at BB-plus with a negative outlook.