Nov 21 (Reuters) – Global ratings agency Moody’s affirmed the United Kingdom’s Aa3 rating on Friday, citing the significant credit strength of the world’s sixth-biggest economy and the government’s commitment to reducing the large budget deficit.<\/p>\n
The agency maintained the country’s outlook at “stable”.<\/p>\n
Sign up here.<\/a><\/p>\n “The rating affirmation incorporates our expectation of fiscal measures consistent with the government-defined fiscal rules in the upcoming 2026 budget due to be presented on 26 November, which will help to keep the cost of debt moderate,” Moody’s said.<\/p>\n Finance minister Rachel Reeves, in her second annual budget, is expected by economists to raise taxes by 20 billion to 30 billion pounds to keep her budget goals on track.<\/p>\n Reeves has vowed to end borrowing to fund day-to-day spending by 2029-30, although the government will continue to borrow significantly for long-term investment projects.<\/p>\n Official data released earlier on Friday showed that public borrowing in the first six months of the 2025-26 tax year was 10 billion pounds higher than the country’s budget watchdog had predicted at the time of Reeves’ last budget update in March.<\/p>\n The 117 billion pounds of borrowing was the highest in nominal terms since 2020, when the government spent heavily during the COVID-19 pandemic, causing public debt to lurch higher.<\/p>\n Reporting by Shanima A in Bengaluru, David Milliken in London; Editing by Vijay Kishore<\/p>\n Our Standards: The Thomson Reuters Trust Principles., opens new tab<\/a><\/p>\n