Oops! S&P downgrades France’s AAA by mistake
Ratings agency Standard & Poor’s (S&P) was last night at the centre of a storm after it accidentally downgraded France’s AAA rating.
An email sent out by mistake in the afternoon claimed France had lost its AAA status, before S&P was forced to issue a statement revealing its error.
The statement said: “As a result of a technical error, a message was automatically disseminated today to some subscribers of S&P’s Global Credit Portal suggesting that France’s credit rating had been changed.
“This is not the case: the ratings of Republic of France remain triple A with a stable outlook and this incident is not related to any ratings surveillance activity. We are investigating the cause of the error.”
However, French authorities are understood to be furious, and have demanded an inquiry into the incident.
The mistake comes at a terrible time, with all eyes on Europe as concerns grow over which nations are going to need financial support to remain solvent.
A rescue package has been proposed for Greece but Italy may now also need some form of bailout, after yields on its debt spiked to over 7% earlier this week.
French bond yields have also jumped in recent weeks and yesterday, after the error by S&P, 10-year bonds hit a new euro-era spread above German bunds of 1.68%.
Users of S&P’s Global Credit Portal, the company’s subscriber service which is used by banks and investors in financial centres, published the mistake at about 3pm. Its analysis of France had been linked in a section on its website entitled “downgrade”.
This article was first published on Investment Week