Ireland's credit rating cut to Junk status

Moody's credit rating agency yesterday reduced Ireland's credit rating to junk status (Ba1 with a negative outlook) http://www.moodys.com/research/Moodys-downgrades-Ireland-to-Ba1-outlook-remains-negative?lang=en&cy=global&docid=PR_222257

Look back at a earlier post of mine 'Bonds, a beginners guide' for more information on what the credit rating means to us. They claim that it is due to the fact that Ireland will likely need a second bailout as they doubt we will be able to return to the bond market as planned in 2013. Ironically by moving our credit rating to this level we are even less likely to engender confidence from the markets.

Predictably the move has predictably been criticised by the ECB, NTMA, and government. Europe is getting mighty peeved with the ratings agencies who they believe have been less than helpful in ensuring the never ending Euro 'crisis' gets towards a resolution of sorts.

In future we may see a Euro bond, where any Eurozone member state can borrow based on the strength of Europe as a whole and not strictly based on the performance of their own individual economy.

FS