Standard & Poor's is set to downgrade the credit ratings of France and other Eurozone countries, France's finance minister confirmed Friday.
France, which is Europe's second-largest economy behind Germany, will be lowered one notch to AA-plus from its previous stellar AAA rating. France will then have the same credit rating as the U.S., which was downgraded by S&P in August.
Standard & Poor's plan, announced late Friday afternoon on French television by the nation’s finance minister, Francois Baroin, was somewhat expected since S&P warned in December that it might cut the ratings. Investors had for the most part already priced in news of the downgrade, and major global stock indexes had only moderate declines.
France’s CAC-40 closed slightly lower, shedding 3.49 points, or 0.11%, to 3196.49. The broader Euro Stoxx 50 index dropped 7.84, or 0.33%, to 2338.01. In the U.S., the Dow Jones industrial average was down 59.37, or 0.48%, to 12411.65 with about 30 minutes left in the trading day.