Standard & Poor’s (S&P) has downgraded the sovereign credit ratings of nine members of the eurozone.
France has lost its “AAA” rating, having been downgraded one notch to “AA+”.
Long-term ratings on Austria, Malta, Slovakia, and Slovenia have also been lowered by one notch.
Long-term ratings on Cyprus, Italy, Portugal and Spain have been lowered by two notches.
According to S&P, the outlooks on the long-term ratings on Austria, Belgium, Cyprus, Estonia, Finland, France, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, and Spain are all negative, meaning that there is at least a one-in-three chance that the rating will be lowered in 2012 or 2013.
The outlook horizon for issuers with investment-grade ratings is up to two years, and for issuers with speculative-grade ratings, up to one year.
In addition, S&P has assigned recovery ratings of “4″ to both Cyprus and Portugal, indicating an expected recovery of 30% to 50% should a default occur in the future.
The firm says its actions have primarily been driven by its assessment that the policy initiatives taken by European policymakers in recent weeks may be insufficient to fully address ongoing systemic stresses in the eurozone.