Moody's cuts France's 'AAA' credit rating

Last Updated: Tue, Nov 20, 2012 05:10 hrs

Moody's Investors Service has downgraded France, stripping the country of its prized AAA credit rating.

The international ratings agency cut the French government bond rating by one notch from the highest level to "Aa1" and warned that an additional downgrade was possible.

In keeping France on a negative outlook, Moody's on Monday signalled that its rating could be cut again in the medium term, the Australian reports.

According to the paper, Moody's statement pointed to many structural problems with the French economy, which made it harder to compete on a global level.

It noted that Paris could face fiscal issues in the future and that it was exposed to demands for financing from heavily-indebted eurozone partners.

According to the paper, the ratings agency took note of reform plans that have been unveiled by the new Socialist French government.

The agency, however, added that 'the track record of successive French governments in effecting such measures over the past two decades has been poor.'

Moody's is the second of the three major ratings agency to cut France's top rating, after Standard and Poor's did so in January, the paper said. (ANI)

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