British pound came under pressure last night, after a credit rating agency, Fitch Rating , issued a warning. It stated that UK is at risk of loosing its AAA rating status, more than any other top-rated nation. It has to do with widening budgetary gap and seemingly lack of credible plan to restore fiscal stability. It wouldn’t be the first time that negative comments of this sort were made. In May S&P lowered outlook for UK from stable to negative, move that was largely symbolic, not effecting credit rating. By contrast, though, Moody’s opinion is that ” UK is among resilient Aaa rated countries”, as stated in November. Go figure.

This lack of consensus should be no surprise coming from industry that lost any credibility at the beginning the financial crisis. These are the same people who were rubber stamping highest ratings on securities defaulting just weeks later. Either complete incompetence, or fraud- take your pick, one is as bad as the other. I find it amazing that all three of these agencies were not disbanded by authorities and industry rebuilt from scratch. As is, people are paying attention to them, even though they still have no congruity. For example, if shortfall in UK budget is so disturbing, how should US or Japan rate? In case of America we are talking about trillions of dollars over next decade. No warnings about that?
British credit rating at risk.