Fitch says may cut Greece rating to junk

Fitch Ratings said there was a growing probability it would cut Greece's sovereign foreign currency credit rating to junk, highlighting doubts over Athens' ability to pull itself out of a debt crisis that has shaken the euro zone.
It put Greece on review for a possible downgrade and said its review, which is already under way, was now likely to be completed in January 2011.
The review will "focus on an assessment of Greece's fiscal sustainability in the wake of the measures that the authorities have taken this year under the International Monetary Fund- European Union program," Fitch said in a short statement.
Greece, which in May became the first euro zone country to receive a bailout, is already rated as junk — or below investment grade — by Moody's and Standard & Poor's. All other members of the single currency area have investment grade ratings.
Fitch's warning adds to a series of bad news for the euro zone on the rating front as it struggles with its biggest crisis on record, coming on the heels of several downgrades for Ireland. Spain and Portugal also face the threat of cuts.
Greece has suffered a series of downgrades since revealing last year that its budget deficit was more than twice as big as forecast, triggering a debt crisis that has sent shockwaves through global markets.
Fitch had cut Greece's rating to BBB-minus in April, the lowest investment-grade level.
Standard & Poor's warned earlier this month it could cut Greece's BB-plus credit rating if it becomes clear that the proposed European Stability Mechanism will favour public creditors to the detriment of private bond holders.
Last week, Moody's put Greece's credit rating on review for a possible downgrade, citing uncertainty over the country's ability to cut its debt to sustainable levels. It said a multi-notch downgrade was possible if it concluded there was an increased risk the ratio of debt to GDP would fail to stabilise in three to five years or that EU support would turn out to be less strong after 2013.
Greece has launched a series of fiscal austerity measures as part of the 110 bln euro EU/IMF bailout agreement that saved it from bankruptcy in May.