Exchange rates steady despite Italian downgrade

Exchange rates are relatively flat today, despite Italy’s debt rating being downgraded by Standard and Poor’s. The agency said weak growth may limit Rome’s ability to cut state spending and bring its finances in order.

Markets shrugged off the decision, while Italian Prime Minister Silvio Berlusconi said the move was influenced by “political considerations”. For the Euro, we have seen little change in exchange rates, while sterling remains stable against most currencies ahead of tomorrow’s key Bank of England minutes, which are due out at 9.30am.