Another PIGS on credit watch negative: Spain refinances huge amounts of debt in 2011 which could cause considerable strain

Spain, which is seen as another country that could catch the Eurodebt contagion, has been placed by Moody's on credit watch negative. 

Spain has a huge amount of debt coming up for refinancing in 2011 and if yield get too much higher it will cause considerable damage to the country's finances.  Via Moody's:

The main triggers for placing the rating on review for possible downgrade are:

(1) Spain's vulnerability to funding stress given its high refinancing needs in 2011. This vulnerability has recently been amplified by fragile market confidence.

(2) A potential further increase in the public debt ratio should the cost of bank recapitalisation prove to be higher than expected so far, whether to meet higher-than-expected asset impairments or simply to retain the confidence of the wholesale markets.

(3) Increased concerns over the ability of the Spanish government to achieve the required sustainable and structural improvement in general government finances given the limits of central government control over the regional governments' finances.

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