11 December 2009

UK Rating is Safe!

Everyone breathe a sigh of relief. No, not just because it's Friday and the weekend is nearly here, but because the UK's sovereign rating is not under threat...well, not for now at least.

Top rating agency Moody's Investor Services has decided not to strike a prized "a" from the current triple A (Aaa) rating that the UK treasures. It sees no reason to do so because at the moment the country apparently is able to finance its whopping deficit.

A sovereign rating is highly important for any country, and being downgraded only means becoming more unattractive to foreign investors. This week, both Spain and Greece were downgraded by two of the other top rating agencies, Standard & Poor's and Fitch.

The pound was somewhat buoyed by the news, although it had taken a knock after the Pre-Budget report yesterday.

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