As a reminder on Friday Moody's downgraded....>

ITALY: As a reminder on Friday Moody's downgraded the Government of Italy's

local & foreign-currency issuer ratings to Baa3 from Baa2 & changed the rating

outlook to stable. Moody's cited "a material weakening in Italy's fiscal

strength, with the gov't targeting higher budget deficits for the coming years

than prev. assumed. Italy's public debt ratio will likely stabilize close to the

current 130% of GDP in the coming years, rather than start trending down as

prev. exp. Moreover, the public debt trend is vulnerable to weaker growth

prospects, which would see the public debt ratio rise further from its already

elevated level." Moody's also noted "the negative implications for medium-term

growth of the stalling of plans for structural econ & fiscal reforms. In Moody's

view, the government's fiscal and economic policy plans do not comprise a

coherent agenda of reforms that will address Italy's sub-par growth performance

on a sustained basis. Following a temporary lift to growth due to the

expansionary fiscal policy, the rating agency expects growth to fall back to its

trend rate of around 1%. Even in the near term, Moody's believes that the fiscal

stimulus will provide a more limited boost to growth than the gov't exp."