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Italy's Credit Rating Takes a Hit as Economy Shrinks

Italy's credit worthiness has been downgraded by the ratings agency S&P.

It said the continued weakness of the Italian economy was behind the cut, which saw the rating of government debt lowered to BBB from BBB+.

Italy, the eurozone's third largest economy, has been in recession since the middle of 2011 and unemployment is currently running at more than 12%.

S&P said it expects the Italian economy to contract by 1.9% this year, much worse than its previous forecast.

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