The eurozone has been hit with a number of credit downgrades by Standard & Poor's, France and Austria both lost their AAA credit ratings and were reduced to AA+, and the credit ratings of Italy, Spain and Portugal were cut by two notches each.
Germany, the Netherlands, Finland and Luxembourg have maintained their triple A ratings for now.
In plain English, what the means is that the costs of borrowing for the countries hit with downgrades is headed upwards and they'll have to offer a higher rate on bonds to attract investors.It also means that the eurozone's rescue fund used for bailouts could also very likely have it's rating cut,ultimately meaning that the eurozone countries are going to have to pony up more cash to keep it solvent.
The current downgrade came on the heels of disappointing returns on the recent Italian bonds auction and a failure of the major banks participating in the write down of Greek debt to agree on who gets stuck for how much, thus stalling the negotiations.
On the selfishly plus side,this could spark more of an appetite among investors for non-EU debt in America, Israel, Australia, Canada, and elsewhere, because it's seen as safer.
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