Spain on Monday became the first country to lose its triple A credit rating from S&P since Japan in 2001, spurring a slide in the euro as the economic outlook for Europe worsened. S&P said it had downgraded Spain’s long-term sovereign debt because of its deteriorating public finances. The decision, which is likely to increase borrowing costs for the Madrid government and for Spanish companies, highlighted strains within the eurozone between its relatively robust northern economies and those in the south – Spain, Portugal, Italy and Greece – that would benefit more from a devaluation of the single currency. The euro fell against the dollar and the yen, while the spread in bond yields between Spain and Germany, Europe’s biggest economy, widened to record levels

This entry was posted by Gwen Robinson on Tuesday, January 20th, 2009 at 5:48 and is filed under Capital markets. Tagged with Spain. Edit this entry.