Ratings blow to Spain

FITCH Ratings has dealt a blow to the Spanish government's efforts to shore up confidence in its finances, by cutting the country's credit rating from AAA to AA+.

It said prime minister Jose Luis Rodriguez Zapatero's efforts to close the budget deficit "will materially reduce the rate of growth of the Spanish economy over the medium term".

Last week the government ruled out calling early elections and instead promised more austerity, forecast lower economic growth and higher unemployment. "The people gave us their trust to govern for four years. That time is not up," deputy prime minister Maria Teresa Fernandez de la Vega said after a Cabinet meeting.