It was reported yesterday the Moody’s Investors Service has elected to leave its Spain sovereign debt rating at one credit rating level above ‘junk’, with a negative outlook. It apparently did this on basis of what it perceives is “a reduction in the risk of Spain losing market access because of the European Central Bank’s willingness to buy the nation’s bonds”. The markets responded positively, with Spain’s 10-year bond yield falling by 29 basis points to 5.52% as of mid-day (Greenwich Mean Time) yesterday.
The following things are worth thinking about:
