Moody's: B1 for Greece by Milota Sidorova

This has been the loud whist of what everybody in the financial world was thinking – the huge EU and IMF loan was not going to save Greece. Although the country has taken so called “tough” package to lower the debt, there were not many implications it was going to work it out. Such as well there have been doubts whether it was using effectively euro infusion. The first and important signs of disbelief came out past days, after U.S.- based rating agency Moody lowered down Greek debt rating. The country moved from A3 into the “junk” Ba1 status. This position is extremely unwilling, because it prevents investors from buying the country's debt und! er the terms of their investment mandate. That may lead into higher borrowing costs for Athens if it will be seeking for cash.But this rate switch was certainly not a cup of tea of EU's top economic commissioner Olli Rehn who sharply criticized Moody's step calling it “surprising and unfortunate”. According to Rehn it was the wrong timing, because all the Europe and some others world organizations were seeking solution for Greece. The country has taken the first part of EU loan of 14.5 billion euros.Moody's said the uncertainty about Greece plans made them believe the country's creditworthiness was consistent with Ba1 rating, a rating that incorporated a greater albeit, low risk of default. Athens as well as Rehn showed swift disagreement with rating changement. According to Greece representatives, the country has taken important steps, despite of major protests all around the country for past months.

related story (sgx17591): http://www.france24.com/en/20100615-eu-commissioner-attacks-...

by Milota Sidorova for Cantell TV (http://cantell.tv)

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