Fitch downgrades the UK to AA+ from AAA, stable outlook
Less than a month ago, Fitch put the UK on ratings watch negative, saying there was a heightened probability of a downgrade in the near term. At the time, the announcement sparked a half-cent decline in the pound.
Given the warning, this isn’t a shock and the stable outlook is somewhat positive. Here are some of the comments from Fitch:
- UK’s credit profile is ‘extremely strong’
- Forecasts government debt will peak at 101% of GDP in 2015-2016
- Downgrade ‘primarily reflects a weaker economic and fiscal outlook’
I just wrote about my willingness to sell cable, so I’m a bear, but I wouldn’t be surprised to see a bounce above 1.5215 There’s a chance this news leaked early and the downgrade should have been mostly priced in.