Belgium debt rating downgraded

Standard & Poor's has downgraded Belgium's sovereign debt rating by one notch, to AA from AA+.

Citing solvency concerns and broader market pressures, the ratings agency made the move on Friday.

"We think the Belgian government's capacity to prevent an increase in general government debt, which we consider to be already at high levels, is being constrained by rapid private sector deleveraging both in Belgium and among many of Belgium's key trading partners," the agency said.

The country's current gross debt-to-GDP ratio sits at roughly 97 per cent. The G-8 average is 80 per cent. Canada's rate is currently below 40 per cent.

It also cited the government's persistent inability to form a government as a drag on its prospects. The country has been without a formal leadership structure since elections in June of 2010.

Late Friday, Belgian negotiators hurriedly resumed their stalled efforts to form a government.

S&P also changedits outlook on the country to negative, suggesting an additional downgrade could be possible.