Rating agency Fitch’s move to downgrade Italian and Spanish debt has brought more pressure to bear on Europe’s southern economies.
Analysts say little will change as Fitch was only following other agencies, and the outlook was already anticipated.
Faced with growing calls for him to resign Italy’s prime minister, Silvio Berluconi, says that the move will not help the economy
“The last thing our country needs at this moment of global crisis is instability, and let’s not forget this is a crisis without precedence in terms of seriousness. There is a great need for political stability. A crisis in the government would be the last thing that Italy needs at this moment.”
Spain in the meantime has made great strides on national debt even if regional debt remains a worry, and cuts have yet to be made there. But because Spain took measures earlier, its economic prospects are now better than Italy’s.