Bloomberg News

Portugal’s Fiscal Data Are ‘Credit Negative,’ Moody’s Says

October 10, 2011

(Updates with Moody’s comments in second and third paragraphs.)

Oct. 10 (Bloomberg) -- Portugal’s second-quarter fiscal and gross domestic product figures showed a higher-than-expected government deficit equal to 8.3 percent of GDP for first half of 2011, according to Moody’s Investors Service.

The figures are “credit negative” for Portugal, Moody’s said in its Weekly Credit Outlook today.

“A disorderly default by the Greek government would pose the biggest near-term disruption risk to Portugal’s reform plans,” the report said. “A market contagion likely would spread through the euro area.”

Countries receiving support from the European Financial Stability Facility such as Portugal and Ireland would be especially hurt, according to the report.

--Editors: Nate Hosoda, Benjamin Purvis

To contact the reporter on this story: Wes Goodman in Singapore at wgoodman@bloomberg.net

To contact the editor responsible for this story: Garfield Reynolds at greynolds1@bloomberg.net


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