Unemployment reaches in Spain reaches record levels S&P even warned that a further downgrade is possible as it left its outlook assessment on Spain at "negative." Spain, the eurozone's fourth-largest economy, is just now just three notches above so-called junk status. Earlier this week, the Bank of Spain confirmed that the country had entered a technical recession - tow consecutive quarters of negative growth. The country's economic problems have become the epicenter Europe's debt crisis in recent weeks as investors worry over Spain's ability to push through austerity and reforms at a time of recession and mass unemployment. With the economy shrinking and the population restless, there are concerns that the government will not meet its targets and will be forced into seeking a financial rescue as Greece, Ireland and Portugal have done before. The difference is that Spain's economy is double the size of the combined economies of the three countries that have already been bailed out. The other eurozone countries would struggle to muster enough money to rescue it. There are even concerns that France, the second-biggest eurozone economy, could face another downgrade from S&P after the presidential elections next Sunday, in which Socialist candidate Francois Hollande is tipped to defeat President Nicolas Sarkozy. "With a potential change of President on the agenda one might think that France could be next in the firing line," said Gary Jenkins, managing director of Swordfish Research. It will of course depend to some degree on the policies of the next President and it may well be that a Hollande-inspired move towards common eurobond issuance may well placate the agency.