Credit rating blow to cost taxpayers £100bn as downgrade may hit gilts and sterling

It is a calculation of the higher interest payments that investors would demand in return for buying British government bonds, the Daily Mail reports. Spread over five years, a five per cent hike in rates would cost taxpayers more than £112bn extra - £22bn a year. Meanwhile, sterling faces pressure on foreign exchange markets when trading resumes today. Already down five per cent this year against a basket of major world currencies, the pound seems certain to fall further after the announcement on Friday by credit rating agency Moody's that the UK's debt had been downgraded. In ...