Moody's cuts Italian credit rating by three notches

Ratings agency Moody's has slashed Italy's credit rating, piling more pressure on the beleaguered eurozone.

Moody's said last night it had cut Italy's rating three notches from Aa2 to A2, and assigned it a negative outlook, suggesting more cuts could be on the way. The ratings agency blamed a "material increase in long-term funding risks for the euro area", due to lost confidence in eurozone government debts. Despite Rome's low current borrowing needs, and low private-sector debt levels in Italy, Moody's said market sentiment had turned against the euro. The move will heap more woe on the region as it faces its most challenging period since its creation. Ministers across the eurozone are...