European Commission Slams “Incomprehensible” Moody’s Downgrade Of Ireland

Jose Manuel BarrosoEuropean Commission President Joe Manuel Barroso

A spokeswoman for the president of the European Commission, Jose Manuel Barroso, has said the Commission simply cannot understand why the ratings agency Moody’s has decided to downgrade Ireland’s government debt to ‘junk’ levels.Barroso’s spokeswoman Pia Ahrenkildre Hansen said the decision to downgrade Ireland’s rating – by one notch from Baa3 to Ba1 – was “incomprehensible”, and questioned the timing of the announcement which came as the EU and IMF visit Dublin to compile their second quarterly review.

“The Irish government has shown determination and decisiveness in its implementation of the economic adjustment programme,” the spokeswoman said.

“Exports are growing strongly and the country is regaining competitiveness. All of this is set to underpin a return to growth this year.”

Ireland’s borrowing costs this morning reached their highest level in the lifetime of the Euro, as investors continued to sell off European bonds in the wake of the downgrade and increased concerns about the stability of the single currency.

The criticism of Moody’s decision this week follows similarly pointed remarks last week, when Moody’s sent Portugal over the ‘junk’ threshold.

This post originally appeared at The Journal.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.