Italy, Affirmed by Fitch, Faces Tougher Moody’s Ratings Hurdle — Analysis

Italy obtained an affirmation of its investment-grade rating from Fitch Ratings on Friday and faces another, potentially more challenging test at the end of this week, when Moody’s Investors Service takes it under gauge.

Moody’s, which will review Italy this Friday, rates the country at Baa3 with a negative outlook. A downgrade would push Italy into speculative grade, potentially stoking a rise in its bond yields and in its risk premia as investors would likely price in the exit of Italian bonds from some bond indices.