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Standards & Poor's downgrades France, Austria, Italy and Spain

Standard & Poor's on Friday downgraded the government debt of France, Austria, Italy and Spain, but maintained perfect AAA rating of German credit.

s&p aaa triple-aEnlarge
France, Austria, Italy and Spain have lost their coveted AAA rating from S&P's. (PHILIPPE HUGUEN/AFP/Getty Images)

WASHINGTON — Standard & Poor's on Friday downgraded the government debt of France, Austria, Italy and Spain, but maintained perfect AAA rating of German credit, the Associated Press reported

Speaking on France-2 television, Finance Minister Francois Baroin confirmed that France had been lowered by one notch. That would mean a rating of AA+, the same rating the United States has had since S&P downgraded it last August.

More from GlobalPost: Standard and Poor's set to downgrade France's AAA rating

"You have to be relative, you have keep your cool," French Finance minister Francois Baroin said, according to a separate AP article. "It's necessary not to frighten the French people about it."

Losing their perfect ratings will, for those countries affected, make borrowing costs incrementally more expensive, The New York Times reported.

“It’s not good news,” Baroin said, according to the Times, but it is “not a catastrophe.”

This could spell trouble for French president Nicolas Sarkozy, whose center-right government coalition has frayed at belt-tightening measures. Sarkozy is up for election in 2012, and dismissal from the ever-shrinking group of nations with perfect credit could weigh on voters' minds. In September Sarkozy said: “We have one objective and one obligation – to conserve the triple A," according to the Financial Times.

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http://www.globalpost.com/dispatch/news/regions/europe/france/120113/french-credit-rating-downgraded-aaa-aa-standards-poor