The ratings agency Moody's has downgraded six euro-zone members, including Italy, Spain and Portugal, and warned that France, Britain and Austria may lose their triple-A rating. The agency said its decision was based on the "growing risks" caused by Europe's ongoing debt crisis.

A trader at Frankfurt Stock Exchange (August 2011 photo).
Moody's has downgraded a raft of euro zone countries.
Photo: dapd.

The markets may have been unusually upbeat about the euro zone in recent weeks, but the ratings agencies clearly remain unconvinced that Europe can get its debt crisis under control.

On Monday, the ratings agency Moody's downgraded a whole raft of euro-zone countries and warned that France, Britain and Austria may lose their top triple-A ratings. The agency said in a statement that it had "adjusted the sovereign debt ratings of selected E.U. countries to reflect their susceptibility to the growing financial and macroeconomic risks emanating from the euro area crisis."

Among the countries downgraded were Italy, Portugal, Spain, Slovakia, Slovenia and Malta. Italy and Spain saw their rating drop from A2 to A3, Slovakia and Slovenia were downgraded from A1 to A2, Spain from A1 to A3 and Portugal from Ba2 to Ba3. The outlook for all six countries was put as "negative," a sign that Moody's sees a good chance that the ratings will be cut again in the coming 18 months. The negative outlook was prompted by "the continuing uncertainty over financing conditions over the next few quarters and its corresponding impact on creditworthiness," said Moody's.

In January, rival ratings agency Standard & Poor's stripped France and Austria of their tripple-A status, and also downgraded Italy, Spain, Portugal, Cyprus, Malta, Slovakia and Slovenia.