"The deficits could increase from the relatively high levels where they are already and reach certain thresholds in the general government debt and deficit ratios, which might lead to another lowering of the rating," S&P credit analyst Moritz Kraemer told a conference call.

Kraemer said the ratings agency was not considering a breakup of the single currency area and that such a scenario was not being factored into its ratings decisions.

(Writing by Luke Baker and Robin Emmott)