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23 April 2010updated 27 Sep 2015 2:21am

Hung parliament? Fine by us, say rating agencies

Tories wrong to fearmonger about the election result.

By Mehdi Hasan

Earlier this week, Ken Clarke predicted panic in the financial markets — causing a “wobble” in the pound — if the general election failed to deliver a decisive result. “Scaremongering of the worst kind”, was the rather appropriate response from the Lib Dems’ Vince Cable.

Today, David Cameron has continued with his own nonsensical fearmongering about the prospects of a hung parliament and “no overall control” in Westminster in a speech to business leaders.

But here’s Arnaud Mares, lead UK analyst for the credit rating agency Moody’s:

A hung parliament does not in itself have direct implications for Moody’s UK rating.

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Mares said a hung parliament could help rather than hinder Britain’s efforts to reduce its deficit if it delivers public support for spending cuts:

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If you had a fiscal plan agreed by a coalition, that could actually be quite positive, because it would imply broad popular support.

Moody’s is not alone here. The rival rating agency Fitch says its own outlook for the UK economy remains “stable”. And Capital Economics, the consultancy firm, says that the markets have “priced in” a hung parliament now, and are calmer about the idea.

So will Cameron, Clarke and co let this go now? Or will we hear more and more nonsense from desperate Tories about the supposedly devastating financial impact of a hung parliament as 6 May approaches? I suspect we will . . .