A great deal of uncertainty still hangs over the resolution of the Greek bail-out impasse.

While protesters were rioting outside the Greek parliament, the Greek government passed another austerity package. Later in the week, an extraordinary eurozone finance ministers meeting (held by teleconference) postponed the final decision to the regular meeting due next week to assess whether the second bailout package for Greece can be finalised.

The intention behind this delay is due to some EU countries’ resolve to ensure that the Greeks deliver the reforms they are promising.

In the meantime, rating agency Moody’s cut the credit ratings of six eurozone countries, namely Spain, which was downgraded by two notches, Italy, Portugal, Slovenia, Slovakia and Malta, each of which were lowered by one notch.

Furthermore, the Moody’s outlook for all these countries is negative. Moody’s also lowered its outlook on the triple-A ratings of Austria, France and the UK to negative.

The ratings downgrade was not a complete surprise, as these sovereigns were all downgraded by Standard and Poor’s last month.

More importantly, Moody’s is the first rating agency to warn that the UK’s triple-A rating could be at risk.

Finally, in the US, the trade deficit crept up to $48.8 billion in December from $47.1 billion in November. This compares with a Bloomberg new survey forecast for the deficit to rise to $48.5bn.

The increase in the deficit reflects a 1.3 per cent month-on-month increase in imports, which were driven by gains in consumer goods and capital goods imports, and a 0.7 per cent gain in exports, supported by strength in vehicles and industrial supplies.

For the whole of 2011, the trade shortfall grew by 12 per cent to $558bn. This is the largest gap since 2008. Both imports and exports reached record highs.

This article was compiled by Bank of Valletta for general information purposes only.