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Markets Shaking Off UK Downgrade

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  • Description

    IG market analyst Alastair McCaig weighs in on the state of the European markets.

  • Duration 2:04
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Seven let's get some more information on those European markets now live from London with Alastair -- market analyst -- -- -- the markets seem to be shaking off this UK downgrade why is that.

-- morning -- well it's -- it's been pretty positive first stock hit I think if you look at the equity currency and bond markets they've -- Reacted separate T methodically effectively towards the weekend's news that the UK did release it -- AAA rating.

I think it's worth putting this into some sort of perspective.

The markets have been anticipating this for little while.

And if we look at say sterling against US dollar over the last three months we've seen -- -- from about a 162 level down to about 15150.

So I -- united that the weakening of sterling globally has been factored in to an extent as well we've even seen the yields on the year tenure so for now UK -- 11 time or other in the last month also actually be a touch worse than -- of the French who had already lost Herrera AAA rating status.

And again as we look a little bit more broadly.

When we look at the G-7 nations there's any two nations that still have that that top tier rating that's calendar in Germany and all the rest have also fallen by the -- sites I want.

What it -- means today it's has a lot less impact I guess on the markets than than what it would have say 24 cent to six years ago.

Announcer we're also expecting the election results from Italy later today.

What -- -- expect the market to react to that.

Well I think it's it's quite likely -- gonna see some sort of coalition party.

Having to be forms to to creates a governments to -- -- rule literally.

When we look at the Italian -- it's the -- And -- -- it'll be a coalition.

Party needed says it's -- -- -- reforms.

In order to record gaining government's stance that and again when we look at then the history when it comes states in the LS 66 years they have had sixty -- -- -- the sixtieth product.

Government -- taken power said it is a country that's used to a little bit of turmoil when it comes to elections.

All right we'll CNN -- plays out that's Alastair MacKay from IG in London we appreciate it out to thank you.

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