Ratings agency Fitch has strip-ped the UK of its AAA rating due to its “weaker economic and fiscal outlook”.
The agency placed the UK on an AA+ rating, following Moody’s downgrade of UK debt in February.
Fitch said: “The downgrade of the UK’s sovereign ratings primarily reflects a weaker economic and fiscal outlook and hence the upward revision to Fitch’s medium-term projections for UK budget deficits and government debt.”
The downgrade will place further pressure on the Government ahead of next week’s first quarter GDP figures, which will reveal if Britain has managed to avoid an unprecedented triple-dip recession.
The agency now expects Government debt to peak at 101 per cent of GDP in 2015-16, only declining gradually in 2017-18. That is worse than its previous forecast of debt peaking at 97 per cent of GDP and declining in 2016-17.
Fitch, which waited until stock markets had closed before an-nouncing the downgrade, had already warned that the UK Government’s failure to stabilise debt below 100 per cent of GDP and set it on a firm downward path would trigger a downgrade.
Fitch slashed the UK’s growth forecast to 0.8 per cent this year. Next year it expects the UK economy to...
↧