Moody's downgrades eurozone rescue funds

Credit ratings agency Moody's cut its rating for the eurozone rescue funds ESM and EFSF to Aa1 from Aaa following its downgrade of France earlier in November, the agency said on Friday. It said the downgrade of the ESM and the EFSF, which were created to stabilise the eurozone by providing financial assistance to euro area member states in difficulty, was prompted by the high correlation in credit risk among the rescue funds and their largest financial supporters.
Moody's stripped France of its prized triple-A badge this month, cutting the sovereign credit rating on Europe's No 2 economy by one notch to Aa1 from Aaa. It cited an uncertain fiscal outlook and deteriorating economy.