Standard & Poor's downgrades European Union's credit rating
The Euro sculpture stands in front of the European Central Bank ECB in Frankfurt, central Germany. (AP Photo/Michael Probst)
Published Friday, December 20, 2013 6:15AM EST
Last Updated Friday, December 20, 2013 8:49AM EST
BRUSSELS, Belgium -- The Standard & Poor's rating agency stripped the European Union of its triple A credit rating in the wake of a bitter budget battle and the debt problems afflicting a number of its members.
However, Friday's one notch downgrade to AA+ is unlikely to cause too many problems for the world's biggest trading bloc. Though a downgrade can sometimes make it more expensive to borrow money on bond markets, a rating of AA+ is still considered very solid.
EU's Commissioner for Economic and Monetary Affairs Olli Rehn said he disagreed with the rating agency and insisted that "all member states have always and also throughout the financial crisis provided their expected contributions to the budget in full and in time."
Rehn stressed that "the EU rating with the two other major rating agencies Fitch and Moody's is AAA."
The EU borrows money to lend to member states, other countries and some programs. S&P said loans to Ireland and Portugal -- which received bailouts -- represent 80 per cent of the EU's outstanding loans.