Standard & Poor's (S&P) has warned that the majority of the 17 members of the EU are at risk of undergoing a reduction should policymakers fail to come up with a credible debt resolution package at their summit tomorrow (December 9th).
And the leading ratings agency went on to indicate this will likely mean that major financiers across the continent also get downgraded on the basis that the EU's borrowing costs would go up if the region lost its AAA status.
Consequently, the EU has been placed on negative watch by S&P as the outcome of the forthcoming meeting is awaited.
Frank Gil and Moritz Kramer, analysts at S&P, stated: "Our review will focus on the financial ability of eurozone member states to support the EU's debt service should the institution face a period of financial distress."
Recently, the agency indicated that even Germany and France could undergo a downgrade in the near future.
By Claire Archer