EU condemns mistaken S&P downgrade on France

11th November 2011, Comments 0 comments

The EU's Internal Markets Commissioner Michel Barnier on Friday denounced Standard and Poor's erroneous downgrade of France as 'grave'.

"This incident is grave and shows that in the current situation of extreme market volatility and tension, market actors must show rigour and a special sense of responsibility," he said in a statement

Barnier, who has been highly critical of agencies downgrading weaker eurozone members as the debt crisis deepened, said he was specially surprised to see an error made by one of the world's three leading ratings agencies.

The agency announced on Thursday that it had mistakenly announced to some of its clients that it had downgraded France's top "AAA" credit rating.

"As a result of a technical error, a message was automatically disseminated today to some subscribers of S&P's Global Credit Portal suggesting that France's credit rating had been changed," the firm said in a statement.

"This is not the case: the ratings on Republic of France remain 'AAA/A-1+' with a stable outlook and this incident is not related to any ratings surveillance activity. We are investigating the cause of the error."

Barnier said the glitch "reinforces my conviction that Europe must adopt strict rigourous rules" on ratings agencies

Proposed EU legislation he will submit next week notably will open the way for appeals to civil tribunals.

© 2011 AFP

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