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You can find the current article at its original source at https://www.theguardian.com/business/live/2016/jun/27/pound-shares-markets-brexit-crisis-osborne-lew-business-live
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| Britain loses Triple-A credit rating after Brexit vote – business live | Britain loses Triple-A credit rating after Brexit vote – business live |
| (35 minutes later) | |
| 8.53pm BST | |
| 20:53 | |
| Britain’s Brexit crisis is going to dominate tomorrow’s papers. | |
| The Financial Times’ front page has just landed, focusing on the heavy losses on the stock markets and the pound’s drop to a 31-year low. | |
| Tuesday's FT:Sterling and bank stocks hammered as Cameron seeks to calm markets#Tomorrowspaperstoday #bbcpapers pic.twitter.com/kTDrhyiYPi | |
| 8.37pm BST | |
| 20:37 | |
| The FT’s economics editor, Chris Giles, says S&P’s downgrade is a cause for serious concern: | |
| S&P no longer see UK institutions as a strength. Cuts credit rating TWO notches. Worse than financial crisis | |
| 8.30pm BST | |
| 20:30 | |
| Shares are still falling in New York, with 30 minutes trading today. | |
| BREAKING: U.S. markets tumble to new session lows, Dow now down 335+ points, S&P down 2.2% https://t.co/u7XNvdBsax pic.twitter.com/vMeOUsbPLk | |
| Financial stocks are among the big fallers, as in Europe today. | |
| 8.25pm BST | 8.25pm BST |
| 20:25 | 20:25 |
| It’s been a really dramatic day in the financial world; here’s our updated news story: | It’s been a really dramatic day in the financial world; here’s our updated news story: |
| Related: UK loses triple-A credit rating after Brexit vote | Related: UK loses triple-A credit rating after Brexit vote |
| 8.12pm BST | 8.12pm BST |
| 20:12 | 20:12 |
| The scale of S&P’s downgrade tonight is unprecedented, says Reuters’ Jamie McGeever, showing the full impact of Brexit. | The scale of S&P’s downgrade tonight is unprecedented, says Reuters’ Jamie McGeever, showing the full impact of Brexit. |
| Britain's downgrade by S&P today was historic - the first time the ratings agency has ever cut a AAA sovereign rating by two notches. | Britain's downgrade by S&P today was historic - the first time the ratings agency has ever cut a AAA sovereign rating by two notches. |
| 8.04pm BST | 8.04pm BST |
| 20:04 | 20:04 |
| Back in 2012, the LabourList website gathered together George Osborne’s various warnings about the need to keep the AAA rating. | Back in 2012, the LabourList website gathered together George Osborne’s various warnings about the need to keep the AAA rating. |
| For example, in 2009, he declared: | For example, in 2009, he declared: |
| “I have argued it with my opponents in difficult economic times, when I warned them last autumn that the cupboard was bare and the discretionary borrowing had to stop – and now Britain faces the humiliating possibility of losing its international credit rating. | “I have argued it with my opponents in difficult economic times, when I warned them last autumn that the cupboard was bare and the discretionary borrowing had to stop – and now Britain faces the humiliating possibility of losing its international credit rating. |
| Here’s the full list: Some things George Osborne has said about the AAA credit rating | Here’s the full list: Some things George Osborne has said about the AAA credit rating |
| All good clean fun. But in the chancellor’s defense, he did warn the public not to vote for Brexit.... | All good clean fun. But in the chancellor’s defense, he did warn the public not to vote for Brexit.... |
| This must be about the first time in history a finance minister might actually think himself vindicated by a credit rating downgrade | This must be about the first time in history a finance minister might actually think himself vindicated by a credit rating downgrade |
| 7.52pm BST | 7.52pm BST |
| 19:52 | 19:52 |
| S&P held back the downgrade until the London stock market had closed, so the City hasn’t had chance to react yet. | S&P held back the downgrade until the London stock market had closed, so the City hasn’t had chance to react yet. |
| But over in New York, shares are falling deeper into the red on Wall Street. | But over in New York, shares are falling deeper into the red on Wall Street. |
| The Dow Jones industrial average has now shed 306 points, a fall of 1.75% today, on top of the 611 points shed during Friday’s tumble. | The Dow Jones industrial average has now shed 306 points, a fall of 1.75% today, on top of the 611 points shed during Friday’s tumble. |
| 7.50pm BST | 7.50pm BST |
| 19:50 | 19:50 |
| Former Liberal Democrat leader Paddy Ashdown fears that Britain will eventually have to pay more to borrow, due to S&P’s downgrade: | Former Liberal Democrat leader Paddy Ashdown fears that Britain will eventually have to pay more to borrow, due to S&P’s downgrade: |
| UK credit rating down. Cost of UK debt up. 0.5% on £470 bn debt = £22 Bn. 2X our EU contribution to international money men. Taking control? | UK credit rating down. Cost of UK debt up. 0.5% on £470 bn debt = £22 Bn. 2X our EU contribution to international money men. Taking control? |
| A lower credit rating would only affect the cost of new debt, of course, not the existing borrowing. | A lower credit rating would only affect the cost of new debt, of course, not the existing borrowing. |
| Updated | Updated |
| at 7.51pm BST | at 7.51pm BST |
| 7.24pm BST | 7.24pm BST |
| 19:24 | 19:24 |
| S&P downgrades Britain - the key points | S&P downgrades Britain - the key points |
| Britain lost her top-notch credit rating almost exactly 12 hours after chancellor George Osborne claimed that Britain’s economy was in decent shape to face the uncertainty caused by the Brexit vote. | Britain lost her top-notch credit rating almost exactly 12 hours after chancellor George Osborne claimed that Britain’s economy was in decent shape to face the uncertainty caused by the Brexit vote. |
| Here are the key reasons why S&P took this historic move: | Here are the key reasons why S&P took this historic move: |
| 7.24pm BST | 7.24pm BST |
| 19:24 | 19:24 |
| Corporate governance expert Lucy Marcus points out that some UK companies could now face higher borrowing costs, following S&P’s move. | Corporate governance expert Lucy Marcus points out that some UK companies could now face higher borrowing costs, following S&P’s move. |
| This will have serious knock on effects for all UK based companies. https://t.co/lvOuo7zDQc | This will have serious knock on effects for all UK based companies. https://t.co/lvOuo7zDQc |
| That’s because a company can’t have a higher credit rating than its own country [because sovereign states, and their central banks, are the lenders of last resort, in times of crisis] | That’s because a company can’t have a higher credit rating than its own country [because sovereign states, and their central banks, are the lenders of last resort, in times of crisis] |
| 7.13pm BST | 7.13pm BST |
| 19:13 | 19:13 |
| S&P’s two-notch downgrade comes hot on the heels of Moody’s, which downgraded the UK’s outlook to negative on Friday night. | S&P’s two-notch downgrade comes hot on the heels of Moody’s, which downgraded the UK’s outlook to negative on Friday night. |
| Reuters’ Luke Baker points out that the agencies are moving with unusual speed: | Reuters’ Luke Baker points out that the agencies are moving with unusual speed: |
| During eurozone debt crisis, S&P, Moody's and Fitch normally waited until Friday to issue downgrades. Monday and S&P moved on UK already | During eurozone debt crisis, S&P, Moody's and Fitch normally waited until Friday to issue downgrades. Monday and S&P moved on UK already |
| Updated | Updated |
| at 7.15pm BST | at 7.15pm BST |
| 7.11pm BST | 7.11pm BST |
| 19:11 | 19:11 |
| Losing the Triple-A credit rating might not have any immediate impact on Britain’s ability to borrow. | Losing the Triple-A credit rating might not have any immediate impact on Britain’s ability to borrow. |
| That’s because worried investors have been keen to buy UK government bonds since the Brexit crisis erupted, driving borrowing costs down to record lows. | That’s because worried investors have been keen to buy UK government bonds since the Brexit crisis erupted, driving borrowing costs down to record lows. |
| But it’s a humiliating moment for the government, which put ‘repairing the public finances’ at the heart of its strategy (not always successfully). | But it’s a humiliating moment for the government, which put ‘repairing the public finances’ at the heart of its strategy (not always successfully). |
| Moody’s and Fitch both downgraded the UK in 2013. S&P maintained the AAA through the eurozone debt crisis, but has now lost the faith. | Moody’s and Fitch both downgraded the UK in 2013. S&P maintained the AAA through the eurozone debt crisis, but has now lost the faith. |
| This government was totally obsessed with UK retaining its AAA rating after 2008 crash. So it holds EU vote & we lose it in two working days | This government was totally obsessed with UK retaining its AAA rating after 2008 crash. So it holds EU vote & we lose it in two working days |
| 7.07pm BST | 7.07pm BST |
| 19:07 | 19:07 |
| S&P: UK faces constitutional issues | S&P: UK faces constitutional issues |
| S&P is also concerned that the future of the United Kingdom itself is at risk. | S&P is also concerned that the future of the United Kingdom itself is at risk. |
| It says that the majority votes to remain within the EU from Scotland and Northern Ireland create “wider constitutional issues for the country as a whole.” | It says that the majority votes to remain within the EU from Scotland and Northern Ireland create “wider constitutional issues for the country as a whole.” |
| S&P also cites "risks to the constitutional and economic integrity of the UK if there is another referendum on Scottish independence" | S&P also cites "risks to the constitutional and economic integrity of the UK if there is another referendum on Scottish independence" |
| 7.05pm BST | 7.05pm BST |
| 19:05 | 19:05 |
| S&P really hasn’t held back -- this is a TWO-NOTCH downgrade, from AAA to AA, completely bypassing the AA+ rating. | S&P really hasn’t held back -- this is a TWO-NOTCH downgrade, from AAA to AA, completely bypassing the AA+ rating. |
| 6.53pm BST | 6.53pm BST |
| 18:53 | 18:53 |
| Britain loses AAA credit rating | Britain loses AAA credit rating |
| NEWSFLASH: Britain has just lost its last triple-A credit rating. | NEWSFLASH: Britain has just lost its last triple-A credit rating. |
| Standard & Poor’s has downgraded the UK to AA, with a negative outlook, following the EU referendum decision. | Standard & Poor’s has downgraded the UK to AA, with a negative outlook, following the EU referendum decision. |
| UK's last AAA rating gone: S&P cuts UK to AA, negative outlook | UK's last AAA rating gone: S&P cuts UK to AA, negative outlook |
| S&P blames the Brexit vote, saying it has weakened the UK’s “predictability, stability and effectiveness” of policymaking in the UK. | S&P blames the Brexit vote, saying it has weakened the UK’s “predictability, stability and effectiveness” of policymaking in the UK. |
| It also believes that growth will be ‘significantly lower’ between 2016 and 2019, with growth averaging just 1.1% per year. | It also believes that growth will be ‘significantly lower’ between 2016 and 2019, with growth averaging just 1.1% per year. |
| S&P says: | S&P says: |
| “In our opinion, this outcome is a seminal event, and will lead to a less predictable, stable, and effective policy framework in the U.K. We have reassessed our view of the U.K.’s institutional assessment and now no longer consider it a strength in our assessment of the rating.” | “In our opinion, this outcome is a seminal event, and will lead to a less predictable, stable, and effective policy framework in the U.K. We have reassessed our view of the U.K.’s institutional assessment and now no longer consider it a strength in our assessment of the rating.” |
| S&P also warns that foreign firms are less likely to invest in the UK, while sterling could also lose its role as a global reserve currency. | S&P also warns that foreign firms are less likely to invest in the UK, while sterling could also lose its role as a global reserve currency. |
| Reaction to follow...... | Reaction to follow...... |
| Updated | Updated |
| at 6.54pm BST | at 6.54pm BST |
| 6.46pm BST | 6.46pm BST |
| 18:46 | 18:46 |
| Economist: Worst crisis for UK economy since WW2 | Economist: Worst crisis for UK economy since WW2 |
| George Osborne’s claim that Britain’s economy is well-positioned to ride out the crisis has been roundly dismissed by a former chief economist of the Organisation for Economic Cooperation and Development. | George Osborne’s claim that Britain’s economy is well-positioned to ride out the crisis has been roundly dismissed by a former chief economist of the Organisation for Economic Cooperation and Development. |
| The FT has the details: | The FT has the details: |
| John Llewellyn, founder of Llewellyn consulting and a former chief economist of the Organisation for Economic Cooperation and Development, said the UK was heading into recession at a time when its economy was not fixed and the BoE appeared to be the only functioning authority. | John Llewellyn, founder of Llewellyn consulting and a former chief economist of the Organisation for Economic Cooperation and Development, said the UK was heading into recession at a time when its economy was not fixed and the BoE appeared to be the only functioning authority. |
| “We are more worried — for the UK, though importantly not for the world — than we were in 2008 or any other post-World War Two crisis,” he said. “The scale of all this will start to unfold in coming weeks.” | “We are more worried — for the UK, though importantly not for the world — than we were in 2008 or any other post-World War Two crisis,” he said. “The scale of all this will start to unfold in coming weeks.” |
| Llewellyn is also worried about Britain’s ‘twin deficit’ problem (the annual borrowing requirement, and the gap between imports and exports). | Llewellyn is also worried about Britain’s ‘twin deficit’ problem (the annual borrowing requirement, and the gap between imports and exports). |
| Click on this tweet for more.... | Click on this tweet for more.... |
| TIN HAT TIME John Llewellyn, former OECD chief economist, and one of the least alarmist people I know pic.twitter.com/uTvyjU09ND | TIN HAT TIME John Llewellyn, former OECD chief economist, and one of the least alarmist people I know pic.twitter.com/uTvyjU09ND |
| 6.25pm BST | 6.25pm BST |
| 18:25 | 18:25 |
| The FTSE 250 index, made up of 250 UK firms not big enough for the Footsie 100, has been through a torrid two days: | The FTSE 250 index, made up of 250 UK firms not big enough for the Footsie 100, has been through a torrid two days: |
| FTSE 250 closes down 7%. That's 13.7% in two trading sessions. 2nd largest two-day fall since the hurricane in 1987. pic.twitter.com/v2FsB9Nj5N | FTSE 250 closes down 7%. That's 13.7% in two trading sessions. 2nd largest two-day fall since the hurricane in 1987. pic.twitter.com/v2FsB9Nj5N |
| The ‘250 is seen as a better gauge of the domestic UK economy. So this is Not Good.... | The ‘250 is seen as a better gauge of the domestic UK economy. So this is Not Good.... |
| Updated | Updated |
| at 6.35pm BST | at 6.35pm BST |