Moody’s ratings agency today downgraded Cyprus’ government bond ratings to Baa1 from A2 on concerns over the island’s fiscal position, amplified by the destruction of the Vassilikos power plant on July 11.
The outlook is now negative, Moody’s said.
The ratings agency has also downgraded Cyprus’s short-term rating to P-2 from P-1.
“Although the government has recently announced a range of structural measures intended to improve fiscal sustainability, the positive impact of those measures for the next few years will be reduced by the plant’s destruction,” Moody’s said. “This incident has caused material disruption to the Cypriot medium-term economic and fiscal position.”Read More