Ireland’s credit status has been cut to junk by credit ratings agency Moody’s on concern bondholders may be forced to take losses if the current IMF/EU bailout doesn’t work.

The move by Moody’s came despite EU finance ministers agreeing measures to ease pressure on struggling European countries.

The ratings cut will make it harder for Ireland to borrow money on the international markets in the next couple of years.

The National Treasury Management Agency said Moody’s had acknowledged that Ireland has demonstrated a strong commitment to cutting the budget deficit and that the country has enough funding until 2013.