Tuesday, August 23, 2011

Who will be downgraded next?

Japan's sovereign and its major banks' debt was just downgraded by Moody's. While I am not interested in this development, as there is no real risk of Japanese default, I am very interested who the rating agencies will downgrade next. It will not be US, as S&P already did it, and both Moody's and Fitch affirmed their AAA ratings.
I think EUR/USD is down 40 pips on the worry that European country (and I bet a very important one) could be downgraded next. We have been getting all kinds of econodata which point out to major weakness in Europe. Rating agencies had some time to crunch the numbers. Let's see what they come up with...

This is purely a speculation based on price action tonight...

No comments:

Post a Comment