“Some of the reasons for this need little explanation. Low growth has undermined attempts to reduce the fiscal deficit, which remains one of the highest in the OECD. This in turn is likely to lead to the loss of Britain’s prized triple A credit rating this year, making the UK comparatively less attractive to overseas investors. What’s more, capital flows from the eurozone to perceived ‘safe havens’ such as the UK are slowing as the crisis eases. There is also evidence of elevated concern among investors about Bank of England money printing.”
