Fitch ratings agency cut the credit standing of bailed-out Portugal by one notch to 'BB+,' junk-bond status, on Thursday because of its high level of debt and weak economic outlook. Fitch said the rating has a negative outlook, meaning it could be lowered again, citing Portugal's "large fiscal imbalances, high indebtedness across all sectors and adverse macroeconomic outlook" for the downgrade.
Any Fitch rating of BB is deemed speculative quality - or 'junk' in market slang - while a downgrade typically increases the borrowing costs as the country concerned is now deemed a bigger risk.