FLORENCE, ITALY – Standard & Poor’s has cut its Italy rating to BBB- da BBB and revised its outlook from negative to stable, the ratings agency said Friday December 5, 2014.
The agency cited “significant increase in debt coupled with consistently weak growth and low competitiveness”. While Premier Matteo Renzi has “taken steps forward with the Jobs Act” the agency “does not believe expected measures will create employment in the short term”. As well, the reform’s “enabling decrees could be softened…in light of growing opposition,” S&P said.
Economy Minister Pier Carlo Padoan said Friday the nation’s debt is at a standstill. “Italian debt is not rising and if it does, it’s not Italy’s fault,” he said. With inflation at 1.8%, real growth of 1% and nominal growth of 3% “public debt would take a speedy downward path,” the minister said.
Padoan went on to say he supports European Central (ECB) Mario Draghi’s efforts to restart eurozone growth via quantitative easing. “I think this is the direction to take in Europe,” Padoan said.