Moody's downgrades Portugal again

Moody's has downgraded Portugal's credit rating for the second time in less than a month and has warned it could fall further.

Portugal has been downgraded one notch to Baa1 from A3 in a move following Standard & Poor's downgrade last week. Moody's based its decision on "increased political, budgetary and economic uncertainty", the BBC reports. Last week, the Portuguese government missed its budget deficit target for 2010, raising concerns the country will have to ask its European partners for a bailout. Yields on Portuguese government debt rose slightly following the downgrade, to 8.54% from 8.47% on Monday.