SPAIN has been dealt a big blow ahead of the G20 summit in Paris today after having its credit rating cut.
The decision to downgrade the country from AA to AA- by rating agency Standard and Poor (S&P) comes after fellow agency Fitch also slashed Spain’s rating last week.
“Despite signs of resilience in economic performance during 2011, we see heightened risks to Spain’s growth prospects due to high unemployment, tighter financial controls, the still high level of private sector debt, and the likely economic slowdown in Spain’s main trade partners,” said an S&P statement.
The agency downgraded its forecast for Spanish economic growth to roughly one per cent for 2012, a cut of 0.5 per cent from its February prediction.
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