Saturday, January 28, 2012

Athens, Creditors Close In on Debt Deal

Wall Street Journal
January 28, 2012

Greece and its private-sector creditors appeared to edge closer Friday to a long-awaited agreement over a €100 billion ($131 billion) debt write-down on government bonds, after bondholders indicated they may accept lower yields on restructured Greek debt.

The delays in reaching an agreement, and questions about whether bondholders will be forced to take losses, have heightened financial-market uncertainty about the management of the Continent's sovereign-debt crisis.

Fitch Ratings on Friday downgraded Italy, Spain, Belgium, Cyprus and Slovenia's sovereign-debt ratings. It also affirmed its rating on Ireland. All six countries carry a negative outlook.

Fitch's moves aren't considered as severe as the ones taken by Standard & Poor's two weeks ago, when S&P slashed ratings on nine euro-zone members, including stripping France of its triple-A rating. Fitch's review didn't include triple-A rated euro-zone nations, so France's top-notch rating, in Fitch's eyes, remains intact.

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