S&P lowers Irish sovereign credit rating
Standard & Poor's, the renowned credit rating agency, has today announced a further downgrade on its rating for Irish sovereign debt amid signs that the government's banking bailout will be more expensive than initially thought. The rating was lowered to AA- which is three notches below the AAA that many governments around the world had enjoyed prior to the credit crunch and the worldwide recession. So what does this mean for the Irish authorities?
Ultimately the first impact will be on servicing debt and future auctions to investors with the authorities forced to offer a higher degree of interest. This will mean that more and more money from the Irish economy and the Irish government coffers will be used to cover interest payments thereby reducing the amount of funding available to inject back into the economy. There is some debate as to whether the Irish economy is on the edge of total collapse with some suggesting that recent tax rises and budget cuts may well be enough to save the situation.
However, others have suggested that Ireland is potentially "another Greece" for the European Union to sort out. Even though exports from Ireland are expected to increase over the next 12 months the degree of unemployment in the country is still uncomfortably high.
Share this..
Related stories
Rates left on hold
The Bank of England has left interest rates on hold at 5.75 per cent, despite the release of weak economic data this week. Economists had said that the emergence of figures showing a slump in manufacturing production and retail sales meant that a rate cut could be on the cards, with monetary policymakers under growing pressure to take action to reduce the risk of a sharp economic downturn. There a...
Read MoreGreek government wanted European debt solution
The Greek authorities have today confirmed that whilst they are not against assistance offered by the International Monetary Fund (IMF) they would rather have a 100% European initiative on the table. This comes at a time when the Greek authorities are looking at a meeting with European Union leaders which is expected to last 10 days and should rubberstamp budget requirements and the rescue package...
Read MoreGeneral Motors European operations sold
In a surprising development, Fiat dropped out of the bidding for the GM European arm leaving the way free for Magna International which is a collaboration between Russian investors and bankers, with GM and employees also retaining a stake. This should hopefully see the Vauxhall operation, the key to the UK car manufacturing industry, change hands over the next few days and eventually see GM Motors...
Read MoreCSA to 'name and shame' absent parents
Absent parents who fail to make maintenance payments to support their children are to be 'named and shamed' on a government website.Letters are reportedly being sent from the Child Support Agency (CSA) to around 100 single parents, asking for their permission to disclose the names of former partners who are refusing to provide financial support to their offspring.If the recipients of the letters d...
Read MoreEconomic experts demand rate cut to 2%
As we near D-day for the next possible reduction in UK interest rates many experts are now forecasting a fall to 2% in order to try and refloat the UK economy. The Bank of England appears to have taken on a totally alien strategy over the last few weeks and has been more susceptible to suggestions from third parties and the government.
While there has been some criticism about the a...