EU under pressure after Moody’s downgrade

The credit ratings agency Moody’s has ratcheted up the pressure on the EU ahead of meetings that are seen as crucial in stemming the sovereign debt crisis sweeping the region.

Moody’s has downgraded the outlook from stable to negative the EU’s AAA long-term issuer rating. Moreover, the agency has downgraded from stable to negative the provisional Aaa rating on the region’s medium term note programme.

Moody’s said the downgrade reflects the negative outlooks assigned to the Aaa countries that are the biggest contributors to the EU’s budget. In July, the ratings agency changed from stable to negative the outlook on Germany and the Netherlands.