The agency Fitch Ratings downgraded on Friday evening the long-term sovereign rating of Spain at one stage to AA + from AAA. "The slowdown in the private sector and external debt burden reduce the rate of growth of the Spanish economy in the medium term", - stated in the message Fitch.

After the authorities in Greece, Italy and Spain, the UK Parliament ratified on Thursday last week the government's plan to reduce budget spending by € 15 billion ($ 18.4 billion). For the initiative of Prime Minister Jose Luis Rodriguez Zapatero, 169 MPs voted against - 168. It involves reducing the budget deficit to 9,3% of GDP this year and nearly double, from 11,2% to 6% - in 2011.

Reducing government spending led to revision of the forecasts of economic growth for 2012 and 2013 - a Friday afternoon, Finance Minister of Spain, Elena Salgado, announced the lowering of forecasts of GDP growth by 0,2 percentage points to 2,5% and 2,9% respectively. Fitch forecast assumes growth in these years to 1,7% and 1,9%.

Unlike Greece, Spain's financial stability is threatened not so reasonable standards for the EU's debt burden (70% of GDP by end 2011 is projected Fitch), as the situation with unemployment and the mortgage crisis. The government on Friday revised its outlook for unemployment in 2010, increasing its expected level by 0.4 percentage points to 19,4% with a subsequent decrease to 18,9%, 17,5% and 16,2% in 2011-2013.

Observers say - the only way to overcome low employment is a reduction in wages. Plans for the Spanish government has suggested reducing payments to state employees by 5% in 2010, with subsequent freezing. Similar measures in the private sector of the Government of Spain only to agree with unions.

On Friday, the government announced that these negotiations are "very bad", on Saturday, unions have stated that no solution. If the end of May will not be able to agree on reform, Mr Zapatero will have to "push it through Parliament in defiance of the united opposition," said Speaker of the socialist faction in parliament, José Antonio Alonso. "Perhaps the government will reform the labor market by royal decree," - he suggests. Trade unions have appointed one-day strike on 8 June and warned about their readiness for a general strike.

Simultaneously, the Bank of Spain announced the possible tightening of reserve requirements for banks - is planned to intensify the struggle with bad debts (5.1% of bank loans in late 2009 without taking into account savings banks, cajas) and increase the level of reserves, especially real estate transactions, if it is on the balance sheet of the bank more than two years. According to the Spanish Central Bank, the collapse of the real estate market has forced banks to take on the balance of ownership of the € 60 billion ($ 73.3 billion).

Cajas before the crisis was one of the engines of the Spanish mortgage boom on their balance sheets more than half the mortgages in Spain, the level of bad debts in their portfolios, according to the Spanish Ministry of Finance, may reach 9%. Cajas to refinance a € 125 billion ($ 153 billion) before the end of 2011, analysts say Deutsche Bank.

The European Central Bank will be forced to provide them with funds under the safeguards of the Spanish government - to save Savings Banks have already created a special fund for € 9 billion and € 90 billion state guarantees.