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Tunisia-Moody’s: Government pays price for firing Kamel Nabli

Tunisia’s fragile democracy learned a hard lesson about global financial markets on Monday, getting a swift downgrade by Moody’s Investor Services just days after firing is widely respected central banker, Canadian paper Globe and Mail reported.

Moody’s said the loss of Mr. Nabli “damages the central bank’s credibility” and “will further unsettle investors already jittery after last year’s revolution.”

“We interpret Mr. Nabli’s dismissal as a way for the government to intervene in the financial and banking sector and potentially undermine the central bank’s independence, which is critical for macroeconomic stability,” the ratings agency said in its credit outlook

Moody’s warns that some political leaders may be tempted to put off action until the next scheduled elections in March, 2013, but inaction for that long will have dire consequences for an economy in need of careful and constant care, says Moody’s quoted by Globe and Mail that does not provide any details yet on the extent of this downgrading.

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