REFILE-S&P report on euro zone ratings expected in Jan -sources

Fri Dec 23, 2011 6:59am EST

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LONDON Dec 23 (Reuters) - Standard & Poor's is expected to release its eagerly awaited verdict on debt ratings for 15 euro zone countries in January, two independent European government sources told Reuters.

"We have got an informal signal from Standard & Poor's that they will come only in January," said one source who declined to be named because exchanges with the rating agency are confidential.

"In conversations we have had, they have let this be known if you read between the lines," he added.

He said he could only speak for his country but assumed all 15 countries under review would learn of the decision at the same time.

A senior euro zone source from another country also said the ratings agency's decision was likely to come next month.

S&P warned on Dec. 6 that it may carry out an unprecedented mass downgrade of credit ratings of euro zone countries if EU leaders failed to agree on how to solve the region's debt crisis at a Dec. 9 summit.

The ratings agency said it expected to conclude its review as soon as possible after the summit.

An S&P spokesman declined to comment on Friday.

The ratings agency placed 15 euro zone countries on credit watch negative - including those of top-rated Germany and France, the region's two biggest economies - and said "systemic stresses" were building up as credit conditions tighten in the 17-nation bloc.

While credit watch negative typically signals a possible downgrade in no more than three months, S&P said at the time it expected to conclude its review "as soon as possible" following the summit.

Policymakers at the EU summit focused on a plan for tighter euro zone fiscal rules, which they hope will prevent debt problems from worsening.

But the market response has been cool, due also to the reluctance of the European Central Bank to play a more interventionist role.

Other ratings agencies are also keeping a close eye on the region.

Moody's, which reaffirmed Austria's top rating on Friday, had said it would review the ratings of all 27 EU states in the first quarter of next year.

Fitch Ratings last week put six euro zone economies including Italy and Spain on watch for potential near-term downgrades, saying it thought a comprehensive solution to the euro zone's debt crisis was beyond reach.

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