Portuguese American Journal

Moody’s downgrades Lisbon, Sintra, Madeira and Azores – Update

Moody’s Investors Services downgraded Thursday the ratings of Lisbon and Sintra cities, in mainland Portugal, and the two autonomous regions of Madeira and Azores.

Moddy’s downgraded Lisbon in four levels from a Baa1 to Ba2, attributing a “negative outlook” to the capital city.

Sintra city, in mainland Portugal, was also downgraded by Moody’s on Thursday, from Baa1 to Ba2 rating, with negative outlook.

The autonomous regions of the Azores and Madeira were also downgraded, both from a Baa2 to Ba3 rating.

In addition, Moody’s downgraded further the ratings of four major Portuguese banks, namely Caixa Geral de Depósitos (CGD), Banco Espírito Santo (BES), Banco Comercial Português (BCP) e Banco Internacional do Funchal (Banif). The rating agency had downgraded BANIF, two notches down, on June 24, from Baa3 to Ba2 junk rating.

Four Portuguese companies were also downgraded by Moody’s, on Thursday, namely CP, Refer, Parpúlica and RTP.

Marcelo Rebelo de Sousa

Portuguese opinion leader Marcelo Rebelo de Sousa said, Thursday, he believed a conspiracy by the United States was underway to degrade the Euro and undermine the European economy. He said, “I believe, as it is evident, that the situation reveals an American strategy against the Euro and against Europe, with the rating agencies having a relevant role. They [rating agencies] are American and they promote the dollar by taking action, at crucial times, unfavorable to the European economies.”

On Tuesday, Moody’s downgraded Portugal’s sovereign debt to junk status, to Ba2 and Baa1.

Portuguese and European officials have condemned Moody’s actions, accusing the rating agency of questionable conduct.

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