Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Moody's downgrades Portugal's debt

By Aaron Smith, CNNMoney.com staff writer


NEW YORK (CNNMoney.com) -- Portugal is the latest European nation to get slapped with a downgrade on its debt. On Tuesday, Moody's Investors Services took Portugal's bond rating down a few notches, citing a foundering economy.

Moody's downgraded Portugal's government bond ratings to A1 from Aa2, saying this stemmed from "ongoing deterioration in the country's debt metrics."

"This deterioration came about due to the government's anti-crisis measures and the operation of the budget's automatic stabilizers, such as higher unemployment benefits, when the economy went into recession," wrote Anthony Thomas, vice president and senior analyst in Moody's sovereign risk group.

The rating agency also said the country's economy is "likely remain relatively weak unless recent structural reforms bear fruits over the medium to longer term."

Going forward, Moody's defined Portugal's rating outlook as "stable, with the upside and downside risks evenly balanced."

Moody's had placed Portugal's bond ratings on review for possible downgrade on May 5. Back in October 2009, the rating agency had changed the outlook on the Aa2 to negative from stable.

Portugal is a member of the so-called PIGS, a club of economically woeful nations in Europe, including Italy, Ireland, Greece and Spain.

On April 27, Standard & Poor's downgraded the sovereign ratings of Greece and Portugal to junk status, citing weak "macroeconomic structures." Moody's had downgraded Greece's government bonds just days beforeTo top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.84%3.85%
15 yr fixed2.96%2.96%
5/1 ARM3.20%3.14%
30 yr refi3.95%3.96%
15 yr refi3.06%3.06%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 16,374.76 23.38 0.14%
Nasdaq 4,733.50 -16.48 -0.35%
S&P 500 1,951.13 2.27 0.12%
Treasuries 2.16 -0.01 -0.37%
Data as of 9:02am ET
Company Price Change % Change
Frontier Communicati... 5.52 0.31 5.95%
Dow Chemical Co 42.83 0.44 1.04%
Ford Motor Co 13.84 -0.03 -0.22%
Micron Technology In... 16.59 0.30 1.84%
Xerox Corp 10.02 0.05 0.50%
Data as of Sep 3
Sponsors

Sections

The Force wasn't the only thing to awaken just after midnight on September 4. Cash registers sprang into life as fans flocked to buy new products tied to the latest Star Wars move. More

U.S. economy added only 173,000 jobs in August, only adding to the uncertainty surround a rate hike from the Federal Reserve. More

Apple could announce a new Apple TV, updated iPhones, and an iPad Pro at its big press event on Wednesday, September 9, in San Francisco More

The BauBax travel jacket, with 15 built-in features, needed $20,000 on Kickstarter, but got $9 million. More

Pimco's famous fund once managed by star manager Bill Gross has less than $100 billion in management for the first time since 2007. More