Moody's to review ratings of EU states next year

The ratings agency Moody's has said it will review the ratings of all EU countries in the first quarter of next year.

In a statement this morning the agency cited a "continued absence of decisive policy measures to stabilise credit markets."

The poor assessment comes just after last Friday's deal to strengthen economic governance which was signed by all members except Britain.

Despite the deal investors are still cautious.

This week they will be looking for clarification on whether the measures are likely to be implemented and how effective they may be in stemming the debt crisis.

In its assessment Moody's said the wider EU is still prone to further shocks and the cohesion of the euro area is under continued threat.