Standard & Poor’s analyst Moritz Kraemer said Italy is the country most under scrutiny by policy makers as its financing needs are larger than the support available from Europe’s crisis-fighting resources.
Britain requires a “sustained” effort to keep its top credit rating, even after the government announced the steepest cuts in spending in a generation, said Moritz Kraemer , head of sovereign ratings for Europe, Middle East and Africa at Standard & Poor’s.
Ever since Standard & Poor’s stripped the U.S. of its AAA credit rating almost two years ago, the unemployment rate has fallen, household wealth has reached a record and the budget deficit is shrinking. More downgrades may be coming, anyway.
Standard & Poor’s, rebuked by Warren Buffett in August after downgrading the U.S. over government gridlock, is again injecting itself into the political process, just as European leaders are poised to meet for a summit aimed at ending the region’s sovereign-debt crisis.
Italy and Spain would be “too big to be saved” by the euro-area’s financial backstop and debate should focus on the firewall’s quality rather than its size, German Finance Ministry official Ludger Schuknecht said.
U.S. stocks rose, erasing an early slump, as the House approved a spending bill to avert a government shutdown. Greek and Portuguese bond yields surged to records amid concern over possible debt restructurings. Gold and silver advanced, while the dollar weakened and oil rallied.