LONDON (Reuters) – A senior official at S&P Global said on Tuesday that Italy’s sovereign credit rating would only be at risk if the coronavirus outbreak hurt the country’s long-term growth potential.
Italy’s government extended quarantine measures across the entire country on Monday in a bid to slow Europe’s worst outbreak of the coronavirus. Its economy is at risk of tipping into a recession as the lockdown hampers activity.
“The big question of course is, is this a single growth shock or does it really lower Italy’s long-term potential growth rate? If the latter is the case, then there is a risk to the rating,” said Frank Gill, S&P Global’s director of sovereign ratings for EMEA during a call.
S&P rates Italy at BBB, the second-lowest investment grade. The outlook on the rating is negative.
(Reporting by Karin Strohecker; Writing by Dhara Ranasinghe)
