After market close on Friday, Fitch downgraded the UK’s Long-Term credit rating one notch to AA-, with a negative outlook. The news may dent the pound, in the opinion of analysts at TD Securities.
Key quotes
“In a decision that will not come as a huge surprise, Fitch downgraded the UK’s Long-Term credit rating to AA- on Friday night.”
“This rating downgrade does not change the medium-term direction or risks around the UK. If we see any FX market reaction at all, we think it will ultimately be only a small blip amid the current market volatility.”
“From our perspective, the first area of significant support comes in around the 1.2305/10 area. A move below this could next target a push to test 1.2125/50.”
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