Italian Prime Minister Silvio Berlusconi criticized a decision on Tuesday by international rating agency Standard & Poor's to downgrade Italy's credit rating, claiming it was based more on media reports rather than the actual situation in the country.
Standard and Poor's has downgraded Italy's debt rating by one level from "A+" to "A", citing the country's problems with public debt.
"We believe the reduced pace of Italy's economic activity to date will make the government's revised fiscal targets difficult to achieve," S&P said.
Italy's rating could be further reduced, as the country's outlook was judged to be "negative," S&P said.
"Furthermore, what we view as the Italian government's tentative policy response to recent market pressures suggests continuing future political uncertainty about the means of addressing Italy's economic challenges," it said.
Moody's international rating agency said in a statement on Saturday it has extended its review for possible downgrade of Italy's Aa2 local and foreign currency government bond ratings.
The downgrade means Italy must pay higher interest rates to investors who extend new credit.
