Moody’s plays down hung Parliament fears

Moody’s Ratings Agency has played down Conservative party warnings that a hung Parliament would definitely lead to a sovereign downgrade.

According to the Financial Times, Moody’s says a hung Parliament may actually be beneficial in dealing with the budget deficit, which was revealed yesterday to be at its highest in 70 years.

Moody’s lead analyst for the UK Arnaud Marés told the FT: “We do not think that a hung Parliament will have a direct impact on the UK credit rating. If you have a fiscal plan agreed by a coalition, that could actually be quite positive, because it would imply broad popular support.”

This assessment comes in contrast to warnings made by the Tories this week. Shadow business secretary Ken Clarke told the FT that a hung Parliament would be a “tragedy” and could lead to a downgrade from AAA status. Shadow chancellor George Osborne said a hung Parliament may force the UK to seek support from the International Monetary Fund.

 

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Readers' comments (2)

  • Chances of a hung parliament increased 100% last night. Cameron’s spin docs must have told him Clegg was main threat and concentrate attacks on him, I assume Clegg’s were the same.

    What a mistake, love him or hate him one thing Brown does have is the credibility and experience of being a world leader, stupid war legacy aside, he was almost untouchable last night and nearly landed a knock out blow to the other two who had clearly taken their eye off him.

    For goodness sake he even managed to get in a rehearsed line that left the other 2 slightly stunned that a man known for his dourness was scoring cheep shots at them.

    So is there a brown bounce due? Will this actually lead to the first hung parliament in a generation, I don’t think, an rightly so, this will lead to a labour win but I think it puts them in the running for a close 2nd when weeks before you were beginning to expect relegated to 4th or 4th behind SNP and Plaid Cymru.

    In the same breath Cameron has been the real loser in these debates so far, He was shown up again as continuing to champion a separatist Euro-sceptic policy that has dogged Tory’s since Thatcher. I honestly think he couldn’t have done their cause more harm if he had admitted to joining up the representatives of the greek nazi league in the euro parliament.

    So in the debate scores:
    Clegg: wins 1 draws 1 Losses 0
    Brown: wins 0 draws 1 losses 1
    Cameron: wins 0 draws 0 losses 2

    This says hung parliament all the way

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  • Dick, I believe that the bias towards Labour we were hearing so much about only a few weeks ago, in which it is suggested that the Tories need to be some 6-7% points ahead to have the same number of HoC seats, when lumped with the surge in Lib/Dem. support puts the UK in totally uncharted territory.

    As a Tory supporter I am disappointed with the party's performance over the last 6-8 months. Their strategy appears to have been 'be very careful not to do anything controversial, say as little as possible and we can just enjoy our opinion poll lead and win the election'. This has led to an appearance of lack of policy and direction and it is this that I fear will loose the election for them.

    There have been plenty of things the Tories could have attacked, Browns insecurity and indecision, his profligacy in inflating public sector jobs and salary's, his pensions mess and of course his claim that he acted decisively over the credit crunch, when in reality he saw total meltdown of all his previous policies staring him in the face. As always he promotes his own views first, his party's views second and looks after the UK needs a long way behind third and these only forced to by absolute necessity, when he has to be seen doing 'something, anything'.
    Much as he sent a couple of warships to the English Channel to help pick up passengers stranded by his, probably over hasty, closing of UK airspace. Again, election coming, must be seen to be actively 'in control'.

    Have always felt he was an Old Labour 'command and control' man at heart!

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