Investors dispute claims sovereign downgrades were hasty

Jose Manuel Barroso, European Commission president

Widely condemned for acting too slowly as the subprime mortgage crisis unfolded in 2007, credit rating agencies have come under fire in recent weeks from European Union officials for acting too quickly in cutting ratings on Europe’s indebted peripheral sovereigns.

On April 9, Fitch cut Greece’s sovereign rating two notches to BBB-, and on April 22, Moody’s downgraded Greece one notch from A3 to A2. Both agencies currently have Portugal (rated Aa2 by Moody’s, and AA- by Fitch) on negative watch