UK debt rating safe... for now

Great Britain’s coveted AAA sovereign debt rating could come under pressure if the government bows to calls to stray from its path of fiscal consolidation in the face of weaker growth, ratings agency Standard & Poor’s said yesterday.

In a release that coincided with a keynote speech by Chancellor George Osborne at the Conservative Party’s annual conference in Manchester, S&P said that British growth was likely to be slower than the government expected.

It reaffirmed its AAA rating for the UK’s debt and said that the outlook was stable.

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“The ratings could come under downward pressure if, against our expectations – and perhaps in response to weakening growth prospects – the coalition Government’s commitment to fiscal consolidation falters,” it said in a statement.

The coalition Government aims to virtually eliminate a budget deficit of around 10 percent of GDP by 2015.