S&P cuts Spain credit rating two notches to BBB-minus

NEW YORK, Oct 10 (Reuters) - Standard & Poor's on Wednesdaycut Spain's sovereign credit rating by two notches to BBB-minus,citing a deepening economic recession that is limiting thegovernment's policy options to arrest the slide.

The downgrade comes with a negative outlook reflecting thefirm's view that there are significant risks to economic growthand budgetary performance, plus a lack of a clear direction ineuro zone policies.

S&P's move brings it in line with Moody's InvestorsServices, which also has Spain on watch for a downgrade from itsBaa3 rating. Both ratings are just on the cusp of junk status,while Fitch Ratings has Spain rated BBB, one notch higher butwith a negative outlook.

(Reporting by Daniel Bases and Luciana Lopez; Editing by DanGrebler)

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