It is often argued that, economicfundamentals and ﬁnancial markets are always in equilibrium and if otherwise, there would be opportunity /or arbitrage. The Greece default crisis which emerged as an important topic of discussion in the recent years, owes it to mismanagement of political, social and economic systems over a long period oflime. The financial and banking crisis o/‘Z008, helped reveal the true facts with respect to mismanagement such as larger ﬁscal deﬁcits, current account deﬁcits, ballooning debt levels, unemployments, negative GDP, manageable inﬂation with above normal interest rates. The credit rating agencies have been argued by many to also have signiﬁcantly played an important role in unearthing the problems with respect to Greece and other neighboring countries such as Portugal and Spain. The downgrades ofsovereign credit ratings by three major credit rating agencies was thought to have signiﬁcant impact on debt markets but less studies have been conducted on the ﬁnancial markets. Thus, the study looks into the impact of these downgrades on not onlyAthens composite index but also on major indices (Seventeen indices) of the world. The event studies conducted ﬁnd significant impact ofthese rating downgrades on theAthens composite index and other neighboring ﬁnancial markets, but does notseem to have major impact of asia-paciﬁc markets.
R, D. (2016). Relationship Between Greece Crisis and Sovereign Credit Rating Downgrades. IMT Case Journal, 6(1), 29-35. https://jetbm.imtnagpur.ac.in/journal/vol6/iss1/5