The ECB's support for eurozone banks was praised but Fitch

The eurozone’s third- and fourth-biggest economies were warned by Fitch of a “near-term” downgrade, alongside Ireland, Belgium, Slovenia and Cyprus. In a further blow, Belgium separately saw its credit rating downgraded two notches, to Aa3, by another leading agency, Moody’s. It cited the “sustained deterioration” in funding conditions for eurozone countries with relatively high levels of public debt, like Belgium, and new risks stemming from the country's troubled banking sector. The downgrade and warnings, delivered after the markets closed last night, came as Spain said its debts had soared; talks with Greece’s private bondholders stalled; and Hungary broke off talks with the International Monetary Fund (IMF). Pitching itself firmly against Germany, the rating agency warned that the European Central Bank (ECB) needed to give a "more active and explicit commitment" to prevent "self-fulfilling liquidity crises" ripping through the eurozone. The ECB's support for eurozone banks was praised but Fitch said the central bank's "continued reluctance to countenance a similar degree of support to its sovereign shareholders" was undermining the efforts to create a firewall to stem the crisis. Fitch said it recognised the "positive commitments" but said its concerns for the debt crisis had "not been materially eased by the summit outcome". The agency said it welcomed leaders' pledges to accelerate the creation of the permanent bail-out fund, the European Stability Mechanism (ESM). But its "particular concern" was still the "absence of a credible financial backstop" in the eurozone. Meanwhile Klaus Regling, chief executive of the European Financial Stability Facility, said he was surprised by the impression that only the ECB has the resources to tackle the debt crisis. He also said Greece may need €100bn for its second bail-out programe.