Moody’s slashes Italy’s credit rating

Moody’s has cut Italy’s rating by three notches from Aa2 to A2, putting more pressure on the global markets.

Silvio Berlusconi
Silvio Berlusconi

The ratings agency blamed a “material increase in long-term funding risks for the euro area”, due to lost confidence in eurozone government debts.

Fellow ratings agency Standard & Poor’s has already cut its rating on Italy to a single A.

According to the BBC
, Italian prime minister Silvio Berlusconi says the decision was expected.

Berlusconi says: “The Italian government is working with the maximum commitment to achieve its budget objectives.”

He says that a plan to balance the government’s budget by 2013 has been approved by the European Commission.