Credit Concern Has Replaced Risk Appetite In Determining USD's Movement?

S&P revised downward the outlook on the UK sovereign credit rating to 'negative' from 'stable', suggesting the nation's AAA credit rating is at risk, as UK's net government debt may reach 100% of GDP and stay near that level in the medium term. This once again triggered investors' concerns on sovereign defaults which has been subdued after several debt-laden emerging economies, including Turkey, Latvia, Hungary and Ukraine, were placed on negative watch or downgraded by Moody's and S&P in late 2008.