UK - It is certainly the case that, for all the austerity rhetoric, public spending continues to spiral upward.

Britain's credit downgrade is a call 

to live within our means

By Liam Halligan

So Moody’s has downgraded the UK. This country’s sovereign debt has dropped one notch from AAA, the lowest possible credit risk, to AA1. For the first time since 1978, Britain has lost its triple-A rating.

The markets saw this coming. All three major credit ratings agencies – the others being Standard & Poor’s and Fitch – have had the UK on “negative outlook” for some time, suggesting a downgrade would follow if the economy deteriorated further. Well, GDP contracted by 0.3pc during the last three months of 2012, we learned a few weeks ago, as Britain flirts with a triple-dip recession.
Little wonder that the Moody’s downgrade notice issued on Fridaynight pointed to “continuing weakness in the UK’s medium-term growth outlook”.
The Government’s fiscal consolidation programme faces significant “challenges”, the agency noted, with our huge public-sector debts “unlikely to reverse before 2016”. Again, this is nothing financial analysts didn’t already know.
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Read more: www.telegraph.co.uk