Moody’s Cuts Ireland’s Credit Rating to Junk

Posted July 12th, 2011 at 6:40 pm (UTC-5)
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Moody’s credit rating service has cut Ireland’s rating to junk status, adding that the outlook for the Irish economy is negative.

This means that, according to Moody’s, Irish government bonds are a high-risk investment.

Moody’s says Ireland likely will need another international bailout.

The rating service says Ireland is meeting the conditions of the loan it received earlier this year, including imposing tax hikes, making economic reforms, and cutting its huge budget deficit. But it says the Irish economy continues to be weak, and that there are significant doubts about whether Ireland can fully implement its loan conditions.

Ireland, Greece and Portugal have accepted hundreds of billions of dollars in economic bailouts from the European Union and International Monetary Fund, with all three countries burdened under massive debt.

EU finance ministers are afraid that other shaky economies, including Italy and Spain, also may need help.