LONDON Feb 25 The reaction by financial markets
on Monday to the loss of Britain's triple-A credit rating with
ratings agency Moody's showed the government still had the
confidence of investors, the country's finance minister said.
"The credit rating is an important benchmark for any country
but this government's economic policy is tested day in and day
out in the market, and it has not been found wanting today,"
George Osborne told parliament.
"I would say the credit rating agencies are important but
they are one test," said Osborne who has been lambasted by
opposition lawmakers for having promised in the past to protect
Britain's top-notch credit rating.
"It is important but it is just one test of the government's
economic credibility in the market and that is tested by the
gilt yields, by the value of sterling, by the ... stock market
and all sorts of other things, and as I say, today we have not
seen excessive volatility," Osborne said.
He was appearing in parliament to answer a question from the
Labour Party opposition about the downgrade announcement by
Moody's late on Friday.
The British pound fell moderately, hitting lows against
the dollar not seen since July 2010. The euro rose
against sterling to its highest since October 2011.
Ten-year British bonds, or gilts, initially sold off sharply
but later regained most of their losses. British stocks were
broadly higher, lifted in many cases by prospects of greater
exports from a weaker currency.