S&P downgrades Italy's credit rating outlook

Standard & Poor's downgraded Italy's credit rating outlook to "negative" on concerns over the weak political front that might hurdle the nation's ability to meet its debt reduction targets.

S&P over the weekend confirmed Italy's long term A+ rating and the A-1+ short term rating, yet the outlook was downgraded to negative from stable on the basis of slow economic growth and "diminished" prospects for cutting the high debt.

S&P warned of the weak position of Prime Minister Silvio Berlusconi that might undermine the implementation of the measures to reduce the debt. The Budget deficit was 4.6% of the GDP last year but debt reached nearly 120% of the GDP.