Debt Management Office chief executive Robert Stheeman, when asked whether Britian’s AAA rating is on a firm footing, said earlier today “I see no reason at this stage to think that it is not. I see absolutely no reason at the moment to be really concerned about it.” Moody’s recently said that the top grade ratings of the UK and US were “being tested” by the global economic downturn.
The UK has had to raise gilts issuance to a record GBP 146 bln this year to pay for the banking system bailout and measures to support growth, but Mr Stheeman feels this should not shake confidence in gilts as a safe investment. He did however conceed that given the huge issuance this year and the likelihood of even more supply in the next fiscal year, that there was always the chance the DMO would have trouble finding buyers at some point.
