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The credit ratings agency Fitch has cut the status of Nokia's bonds to just above junk.

The mobile phone manufacturer's rating has gone from BBB+ to BBB-.

Last week, Nokia warned that its sales for the second quarter of this year would be well below previous forecasts and abandoned its outlook for the full year, knocking 12% off the company's share price in Frankfurt.

Having its rating cut will make it more expensive for Nokia to borrow money.

Fitch warned it might have to cut the rating again as the company loses market share.

In a statement, Fitch said that the situation had been getting worse since Nokia began switching its software to Microsoft's Windows Phone system from its own Symbian.

"The pace of deterioration has picked-up since Nokia decided to switch to an alternative operating system, and it appears consumers are deserting these legacy handsets for cheaper Android versions or high-end Android or Apple smartphones," said Fitch analyst Stuart Reid.