Greece today condemned the rating downgrade
announced by Moody's Investors Service today, saying it was 'completely unjustified' and did not properly reflect the true state of affairs. 'The rating downgrade announced by Moody's today is completely unjustified as it does not reflect an objective and balanced assessment of the conditions Greece is presently facing,' the finance ministry said in a statement.
The finance ministry also blasted the rating agencies as a whole.
'Moody's downgrading of Greece's debt reveals more about the misaligned incentives and the lack of accountability of credit rating agencies than the genuine state or prospects of the Greek economy,' it said.
Earlier, Moody's slashed Greece's credit ratings by three notches from Ba1 to B1 and warned that they could be downgraded further given the risks to the country's stabilisation efforts.
Moody's said the downgrade reflected its concerns over Greek efforts to balance its strained public finances after Athens had to seek a bailout from the European Union and International Monetary Fund last year to avoid default.
'The fiscal consolidation measures and structural reforms that are needed to stabilise the country's debt metrics remain very ambitious and are subject to significant implementation risks, despite the progress that has been made to date,' Moody's, one of the top three ratings agencies, said.
The Greek finance ministry said that 'Moody's focuses its analysis exclusively on the downside risks' and that although it mentions, it does not incorporate in its analysis Greece's significant progress in the implementation of its fiscal consolidation and structural reforms programme.
'Moody's refers to uncertain conditions in the euro zone after 2013 and their impact on Greece's debt, at a time when the European Union and the euro zone are still formulating their policies and there is an explicit commitment from member states to agree on a comprehensive solution to the crisis at the European Council in March,' it said.
'At a time when the global economy is fragile and market sentiment is sensitive, unbalanced and unjustified rating decisions such as Moody's can initiate damaging self-fulfilling prophecies and certainly strengthen the arguments for tighter regulation of the rating agencies themselves,' the finance ministry warned.
Greece has suffered repeated downgrades in recent months from Moody's and fellow rating agencies Standard & Poor's and Fitch. Moody's last downgraded Greece in June 2010 and put it on negative watch in December of the same year.
