World Economy

Moody's warns of possible Italy downgrade if debt ratio not put on downward trend

Key Points
  • The political developments of the last few days have no bearing on Friday's decision to place Italy's ratings under review for downgrade, Moody's said.
A boy waves the Italian flag in front of the Ancient Colusseum
Franco Origlia | Getty Images News | Getty Images

Moody's said on Tuesday it would downgrade Italy if the fiscal policies of the next government were unable to place the country's public debt ratio on a sustainable downward trend.

The political developments of the last few days have no bearing on Friday's decision to place Italy's ratings under review for downgrade, the credit rating agency said.

The agency was referring to the failed attempt by Italy's far right League and anti-establishment 5-Star Movement to form a government. Moody's added the review of Italy's ratings could last more than the usual three month period.