THE RATINGS AGENCY Moody’s has said that it is maintaining France’s AAA rating for now despite rival Standard & Poor’s decision to downgrade the country’s credit worthiness last Friday.

Moody’s said that France’s outlook was stable while S&P had said that its outlook was negative for France whose image and market credibility is likely to be damaged by the decision – the CAC 40 index of shares in Paris is down this morning, but only slightly.

S&P also downgraded Austria, Malta, Slovakia and Slovenia by one notch, and the ratings of four other countries including Italy, Spain, Portugal and Cyprus by two notches last Friday.

Moody’s today cited the French economy’s overall strength but did sound a note of caution in saying that growth prospects present “risks to the French government’s fiscal consolidation plans.”

The agency said it would update the market during the first quarter of this year as part of its initiative to  ”revisit the overall architecture” of sovereign ratings in the European Union.

Despite the widespread downgrades on Friday, markets have been relatively calm on opening this morning. In London, a short time ago the FTSE 100 of leading shares was down by under 1 per cent while the Dax in Germany is up 0.30 per cent.

Standard & Poor’s defends mass European downgrade >

Burton insists: ‘Nobody is talking about a second bailout’ >

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