“Italy has had structural impediments to growth for some time,” said Moody’s analyst Alexander Kockerbeck. “However, today, these challenges coexist with a scenario of rising interest rates and fragile market sentiment.”
“The Moody’s news on Italy reinforces the ECB’s concern about the prospect of contagion,” remarked Greg Salvaggio, senior vice president at Tempus Consulting, according to the Reuters report.
Standard & Poor’s holds Italy’s sovereign debt rating at A+, or two levels below Moody’s, with a pessimistic outlook. Fitch’s ratings holds Italy between S&P and Moody’s at AA-, with a stable outlook.
iShares MSCI Italy (NYSEArca: EWI)
Max Chen contributed to this article.