Source:
NYTThe European debt crisis hit a troubling new note Tuesday when France had to defend its flawless credit rating — one of the few left among major Western economies — after Moody’s Investors Service warned that it was at risk from the Continent’s widening sovereign debt problems.
“We will do everything to avoid being downgraded,” Finance Minister François Baroin said on French television Tuesday.
Hours earlier, Moody’s had said it might put France’s triple-A rating on watch for a possible downgrade within the next three months if slowing growth and the tab for supporting crisis-hit French and European banks strained the budget.
Moody’s said late Monday that the global financial and economic turmoil was making it more difficult for France to keep its government debt from growing, compared with other triple-A-rated countries. France’s debt was 82.3 percent of gross domestic product last year, a shade less than Germany’s.
The price that France pays to borrow on international financial markets compared with Germany rose on Tuesday to its highest level since the euro was introduced in 1999. Rising borrowing costs are what pushed weaker countries, including Greece, Ireland and Portugal, to seek bailouts.
Read more:
http://www.nytimes.com/2011/10/19/business/global/france-defends-its-credit-rating-after-moodys-warning.html