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Cut to Italy credit rating was 'expected'

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Cut to Italy credit rating was 'expected'


The Italian government has reacted calmly to a cut in the country’s credit rating by Moodys.

On Tuesday the ratings agency downgraded Italy three levels from Aa2 to A2 with a negative outlook, blaming chronically weak growth and fears over Europe’s debt crisis.

However, Prime Minister Silvio Berlusconi says Moodys’ decision was ‘expected’ and that the government is ‘working hard to achieve its budget goals.’

Some Italians, like Bruno Baronchietti, are not surprised international markets may be losing faith: “I think our image in the world is so bad that there’s no way to give any kind of confidence to foreign markets,” he said.

Franco Marini thought the downgrade was a kick the government needs: “We deserve it, if we continue like this we will end up like Greece and Argentina. It’s time our politicians started waking up.”

Italy’s government has been given a helping hand from the European Central Bank, whose purchase of the country’s bonds means borrowing costs have come down from a high in August.

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