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06/03/2009
Ireland's Credit Rating To Take Hit
Ireland may lose its highest bracket credit rating because of the slump in Exchequer finances.
International credit ratings agency Fitch said today the country’s debt rating had been placed on "negative watch", meaning the credit rating could be in for a downgrade.
Fitch Rating' long-term credit ratings are set up along a scale from 'AAA' to 'D', and a fall to 'AA', or even 'BBB' could mean the Government will have to pay a higher rate of interest on its borrowings.
In a statement released by Fitch Ratings on Friday, the credit agency said they had "placed the Republic of Ireland's 'AAA' on Rating Watch Negative".
“The rating action reflects recent disappointing news on Government revenue performance which points to very sharp declines in tax receipts across the board in January and February,” Fitch said.
The statement said that the latest information suggests, in the absence of any further Government action, the 2009 deficit could be increased by another €4bn, equivalent to over 2% of GDP.
A spokesman for the agency said: "Fitch will re-assess the medium term prospects for Ireland's public finances in light of the deterioration in revenue prospects, forthcoming policy announcements and worsening economic conditions."
A Rating Watch Negative is typically resolved within three to six months.
(DW/BMcC)
International credit ratings agency Fitch said today the country’s debt rating had been placed on "negative watch", meaning the credit rating could be in for a downgrade.
Fitch Rating' long-term credit ratings are set up along a scale from 'AAA' to 'D', and a fall to 'AA', or even 'BBB' could mean the Government will have to pay a higher rate of interest on its borrowings.
In a statement released by Fitch Ratings on Friday, the credit agency said they had "placed the Republic of Ireland's 'AAA' on Rating Watch Negative".
“The rating action reflects recent disappointing news on Government revenue performance which points to very sharp declines in tax receipts across the board in January and February,” Fitch said.
The statement said that the latest information suggests, in the absence of any further Government action, the 2009 deficit could be increased by another €4bn, equivalent to over 2% of GDP.
A spokesman for the agency said: "Fitch will re-assess the medium term prospects for Ireland's public finances in light of the deterioration in revenue prospects, forthcoming policy announcements and worsening economic conditions."
A Rating Watch Negative is typically resolved within three to six months.
(DW/BMcC)
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