Italy poses the greatest risk to the euro amid the sovereign-debt crisis, Fitch Ratings said Tuesday, citing the size of the country's debt burden, Rome's high borrowing costs and its need to access funding markets.
Italy faces a "daunting" amount of government bonds needing to be paid back in 2012, and the lack of agreement from European leaders on how to implement a "firewall" in the region puts pressure on its rating, said David Riley, head of global sovereign ratings at Fitch, speaking at a conference in London.
Italy's lack of a "credible firewall" is a serious concern for the euro zone, Mr. Riley said.
An Italian government bond yield of four percentage points over the German bund, coupled with zero real gross domestic product growth, could prove "explosive" for the country, although a spread of 1.5 percentage points and growth of 1.5% would leave the country solvent, Fitch said.
http://online.wsj.com/article/SB10001424052970204124204577152233166213286.html
Italy faces a "daunting" amount of government bonds needing to be paid back in 2012, and the lack of agreement from European leaders on how to implement a "firewall" in the region puts pressure on its rating, said David Riley, head of global sovereign ratings at Fitch, speaking at a conference in London.
Italy's lack of a "credible firewall" is a serious concern for the euro zone, Mr. Riley said.
An Italian government bond yield of four percentage points over the German bund, coupled with zero real gross domestic product growth, could prove "explosive" for the country, although a spread of 1.5 percentage points and growth of 1.5% would leave the country solvent, Fitch said.
http://online.wsj.com/article/SB10001424052970204124204577152233166213286.html
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