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Belgium’s Rating Cut 2 Levels by Moody’s on Contagion Risk

Belgium’s credit rating was cut two steps by Moody’s Investors Service, which said rising borrowing costs, slowing growth and liabilities from Dexia SA’s breakup threaten to inflate the euro area’s fifth-highest debt load.

Moody’s lowered Belgium’s debt rating to Aa3, the fourth-highest investment grade, from Aa1, with a negative outlook, the ratings company said yesterday. The action follows Standard & Poor’s one-step downgrade of Belgium to AA on Nov. 25. Fitch Ratings yesterday put the nation’s AA+ rating on review for a possible reduction.