UK plays down importance of AAA rating


Reuters

LONDON — Britain’s top finance officials have played down the importance of the country’s top-notch credit rating, which could be pressured as the government struggles to achieve its deficit cutting aims with the country stuck in recession. Britain’s Finance Minister George Osborne and his deputy Danny Alexander stressed the need to support economic growth alongside reducing a hefty fiscal deficit, but gave no suggestion that the government would relax its program of cuts in the face of pressure to boost a stagnating economy.

“The credit rating is not the be-all and end-all,” Alexander, a member of the Liberal Democrats — the junior partner in the ruling coalition — told BBC radio in comments broadcast on Monday. Asked about Alexander’s statement, Osborne said in televised comments: “Danny Alexander and I completely agree. The credit rating is important but it’s also important to have the right economic policies. That’s what really matters and the credit rating reflects that.” Analysts saw Alexander’s remarks as an attempt by the government to soften the impact of a possible downgrade as a recession is hitting tax receipts, making it harder for the government to reach its deficit targets.