Moody’s has cut Greece’s rating, warning that a planned debt swap would constitute a default. The rating was cut another three notches from Caa1 to Ca – just two more notches shy of a default rating.
“The announced EU programme… implies that the probability of a distressed exchange, and hence a default, on Greek government bonds is virtually 100%,” the agency said.
The debt swap would increase Greece’s borrowing terms by up to 30 years.
