Moody’s Investors Service late on Tuesday cut Spain’s debt by two notches to A1 from Aa2.

The sovereign downgrade was largely due to Spain’s increasing challenge in meeting fiscal targets amid falling house prices and waning growth prospects, according to the agency. It cited “continued vulnerability of Spain to market stress” as a key factor for the cut.

A statement said: “Moody’s is maintaining a negative outlook on Spain’s rating to reflect the downside risks from a potential escalation of the euro area crisis.”

The move follows Standard & Poor’s downgrade less than a week ago and a cut by Fitch at the beginning of October.

Meanwhile, Standard & Poor’s slashed Egypt’s long term sovereign credit rating to BB- from BB on Tuesday the agency said. The rating, which has a negative outlook, was partly blamed on the rising risks following “the transition period for Egyptian political reform.”

“These risks centre on the government’s fiscal stance but also encompass price stability and balance of payment pressure,” S&P said.