UK's credit rating downgraded

Vince Cable dismissed the loss of Britain's prized AAA credit rating as "background noise" today.

The Business Secretary admitted that Chancellor George Osborne had been eager to maintain the top level, but said the reduction to AA1 was "largely symbolic".

Speaking on the BBC's Andrew Marr Show, Mr Cable said:

Former Deputy Prime Minister John Prescott has accused Chancellor George Osborne of "trashing the UK."

Writing in the Sunday Mirror, Prescott said:

George Osborne has vowed to stick to his economic strategy despite Britain being stripped of its prized AAA credit rating.

The Chancellor struck a defiant note after Moody's downgraded the country to AA1 - warning that sluggish growth would continue for years.

Political Correspondent Carl Dinnen reports:

Speaking following ratings agency Moody's downgrading of the UK, Chancellor George Osborne said if the government were to abandon its commitment to tackle the UK's debt problem, the situation would get much worse:

Chancellor George Osborne has insisted the Government was delivering on its commitment to tackle the UK's debt problem after ratings agency Moody's downgraded the country's AAA credit rating.

After Britain's AAA credit rating was downgraded by Moody's, The Exchequer Secretary to the Treasury, David Gauke said it was "a disappointment that we are in this position".

But he added: "We really cannot ignore the fact that our deficit is high, higher than we would like and we are determined to focus on that and the response which is just to borrow more is reckless".

Shadow chancellor Ed Balls has said that the Chancellor needs to "change direction" after Britain's credit rating was downgraded from the top AAA rating by the Moody's credit agency.

He told ITV News, George Osborne's plan is not working: "He's choked off the recovery, borrowing's up, families are suffering and even the credit agencies are now saying it's failed".

The statement from Moody's confirming Britain's downgraded credit rating highlighted the problems the weak medium-term economic outlook poses for deficit reduction plans.

The agency said it now expects the "period of sluggish growth" to "extend into the second half of the decade", adding: