< p>Apologies for the punny headline, and no, I'm not talking about Chelsea FC, but it was still too good to miss. Being the biggest breaking news story of the weekend – unless, of course, you’re a Swansea City fan or give a damn about the Grand Slam – the possible consequences of Moody’s downgrade of the UK’s triple-A rating will affect us all.
 
Before looking at the causes, it’s worth reminding ourselves that the gnomic gurus responsible for the downgrade are the same geniuses who utterly failed to spot the credit crunch – an event largely caused by their irresponsible and incompetent rating of mortgage-backed securities.
 
Whether they’ve got it right this time is not something I intend to dwell on – what’s done is done – but as I’ve said in this column before, it was largely inevitable given the Coalition’s abject failure to get to grips with the deficit and the bloated public sector.
 
So what does it mean for business and already-stretched consumers?

The immediate consequence is a fall in the value of sterling. Some old-fashioned economists – Sir Mervyn King among them – cling to the idea that this is a good thing. An effective devaluation, they argue, will make our exports cheaper. True, but what this argument ignores is the fact we import more than we export these days. A cheaper pound makes everything we bring into the country – oil, gas, food, textiles – more expensive.

Following on from this, we can expect to see a rise in inflation. That’s going to hurt savers even more than they’re already hurting, and will bring further pain to households struggling to foot the weekly grocery bill or fill the petrol tank.

There is also the real possibility that interest rates may, albeit slowly, start to climb from their present historic lows. A ratings downgrade – even it’s just a single notch from AAA to AA1 – may make it more expensive for the government to borrow through the sale of Treasury gilts. If so, this will feed through to general interest rates and the obvious consequences for mortgages.

But it’s not all doom-and-gloom yet. Both the USA and France have already suffered similar downgrades (and Germany may not be far behind). While a blow to national pride, the cost of borrowing for these countries actually reduced a little. But we cannot take this for granted in our case.

Another possible upside is that a cheaper pound will make prime London property even more attractive to well-heeled foreigners looking to take advantage of the capital’s many attractions. This will have developers licking their lips, and may provide new opportunities for well-funded and fleet-of-foot bridging lenders.

With a new Governor of the Bank of England about to take up post, we’re moving into a new economic era. We now know there are no quick fixes to the country’s ails – despite what some disingenuous politicians would have us believe – but I think we’re remarkably good at adapting to new realities. We just need the state to get out of the way and stop punishing enterprise and wealth-creation.