EU member, Latvia, now rated as junk
2009-02-25 HKT 08:24
Latvia's sovereign debt has been cut to so-called junk status as its economy struggles with the financial crisis. The credit ratings agency Standard & Poor's has reduced its rating to BB+/B, which is below what the agency deems to be investment grade. S&P predicted that Latvia's economy would contract by 12 percent this year, following its 4.8 percent decline in 2008. Credit rating agencies, like S&P, have been heavily criticised for their role in the financial crisis. They have been accused of awarding their top ratings to mortgage-backed products which later turned out to be worthless.
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