April 29, 2019 / 4:00 PM / 3 months ago

S&P says "severe" Italy downgrade unlikely, unfazed by early election prospects

LONDON, April 29 (Reuters) - A “severe” downgrade of Italy’s credit rating is unlikely, S&P Global said on Monday, adding that early elections in the country would not necessarily be negative news.

S&P kept a negative outlook — effectively a downgrade warning — on its investment grade BBB rating for Italy on Friday.

“A severe downgrade (of Italy) not very likely,” one of its top analysts Frank Gill said during a webcast. “I would suggest the rating (of Italy) is already quite low given the wealth of the economy and given the very strong net external position.”

He added that an early election, contrary to worries, “could get a more cohesive poicy arrangement in place.”

“An early election would not necessarily be negative news for the direction of policy,” Gill said. (Reporting by Marc Jones; editing by Helen Reid)

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