Goodbye Mr A

After the highly anticipated - and controversial - budget  was announced earlier this week on Wednesday, it appears that the seemingly perpetual gloom around the British economy will not be coming to an abrupt end just yet - as  Britain looks likely to lose it's top credit status in April from another rating agency. In February, Moody rating agency dealt the Chancellor a  blow, by downgrading Britain from AAA status to AA1, warning that Britain will struggle to grow in the upcoming years and arguing that the UK's 'high and rising debt burden' were to blame. Whilst Tory opposition - probably including Alan and Mr Morrison - were supplied with sufficient anti - Tory ammo for another month, it was predicted that another big rating agency would also do the same. Now Fitch rating agency look set to make this prediction a fact.

Fitch has put the UK's rating on a 'negative' watch and has confirmed that it is very possible in April that it will downgrade the UK's rating. You may be thinking that the UK losing an A is rather innocous and that it is just a rating however, it simply isn't. A worsened credit rating is likely to leave investors with a repugnant smell - investing will be less attractive. Lending money is likely to become riskier and if there is little chance of handsome profits, then investment is likely to decrease. Ergo, aggregate demand may also decrease. It comes after the budget was announced on Wednesday, which included policies such as £15 billion being provided to infrastructure by 2020 plus, a 0.6% growth forecast for 2013, which was halved from the original 1.2% forecast because of lower-than expected exports according to the Chancellor. Fitch has also explained that the UK's persistently struggling growth is the reason for their thinking. In addition to this, S&P, the third biggest rating agency which also has AAA rating for the UK, put Britain on negative watch last December. As the Chancellor's arm bands start to burst and as all the lifeguards start poking him with a barge pole, I am going to predict a Jesus - style resurrection for the British economy in the light of Easter,why not?