Market Watch: S&P cuts Portugal's sovereign ratings to 'A-/A-2'

Standard & Poor's Ratings Services on Tuesday lowered Portugal's long-term local and foreign currency sovereign issuer credit ratings to A- from A+.

"The two-notch downgrade reflects our view of the amplified fiscal risks Portugal faces.

Under our revised base case economic growth scenario, we expect the Portuguese government could struggle to stabilize its relatively high debt ratio over the outlook horizon until 2013.

Portugal's public finances in our view remain structurally weak, notwithstanding the government's substantial public sector reforms of recent years," said Kai Stukenbrock, an S&P credit analyst.

The outlook is negative.

Market Watch