Fitch Ratings revised down its sovereign foreign currency credit rating outlook for Spain to negative from stable today while affirming the AA-plus rating, citing the long-term impact of restructuring its savings banks.
"In many respects, Spain has exceeded expectations in terms of fiscal consolidation and structural reform, notably with respect to state pensions and the labor market," Douglas Renwick, sovereign credit analyst at Fitch, said in a statement.
"However, the negative outlook reflects the downside risks to Spain's sovereign credit profile from a weak economic recovery, banking sector restructuring and fiscal consolidation, especially by regional governments," he added.
Spain is rated one notch lower at AA by Standard & Poor's, while Moody's Investors Service rates the sovereign at Aa1, similar to Fitch. Moody's also has the rating on watch for a possible downgrade.
Reuters