Spain’s ability to navigate its way through the crisis is crucial to the future of the euro area as the currency bloc’s fourth-largest economy has the potential to weaken the whole region, Fitch Ratings said.
The U.S. risks entering a recession that will hurt economic growth worldwide should policy makers fail to avoid the so-called fiscal cliff of automatic tax increases and spending cuts next year, Fitch Ratings said.
Most European stocks fell, with the Stoxx Europe 600 Index posting its biggest weekly drop in a month, amid concern that automatic spending cuts and tax increases may push the world’s largest economy into a recession.
Most Swiss stocks fell as fear that the so-called fiscal cliff of automatic spending cuts and tax increases may push the world’s biggest economy into recession offset better-than-expected U.S. consumer confidence data.
Turkey received its first investment- grade ranking since 1994 after Fitch Ratings raised the country by one level, citing an easing in economic risk and lower debt. Stocks and bonds rallied to record levels.
Turkish bond yields are rising faster than the rest of emerging-market debt and still can’t entice the world’s biggest investors, who say policy makers won’t curb inflation unless they take steps to slow growth.