Standard & Poor's is lowering Belgium's credit rating by one notch to AA, blaming concerns about the country's financial sector, slowing growth and the country's political impasse.
"The ability of authorities to respond to potential economic pressures from inside and outside of Belgium... in our opinion is constrained by the repeated failure of attempts to form a new government," S&P said in a statement.
It also said lower economic growth would lead to increased risks to the country's budgetary position.
Belgium's borrowing costs have been rising sharply recently, with the yield on its 10-year bonds moving above 5% earlier this week and rising to 5.89% this evening before the downgrade announcement.
