Moody's downgraded Cyprus

International Rating Agency Moody's downgraded Cyprus by two notches - "A2" to "Baa1". The outlook on the rating is "negative", which means the possibility of further downgrade.

The agency explained its decision by weak economic indicators of Cyprus. Moody's analysts also lowered the forecast on growth of Cypriot GDP to zero in 2011 and one percent in 2012.

In addition, the agency doubts the sufficient stability of the financial system of Cyprus, which is affected by Greek debt crisis.