David Prosser: Home truths for Britain and the eurozone

Outlook Statements of the obvious are not always wasted breath – sometimes they serve as useful reminders of reality. Yesterday, we saw two such examples: Moody's warning that it might have to downgrade the UK's AAA rating should the economy disappoint, and the call from the German Finance Minister, Wolfgang Schaeuble, for a seven-year extension of the life of Greece's sovereign bonds.

Clearly, Britain is going to find it harder to get its deficit under control if economic growth undershoots the forecasts on which our borrowing payments are currently based. Equally clearly, Greece isn't going to be able to meet its commitments to its bondholders given the current state of its finances and the refusal of the markets to extend it affordable credit.

Why, then, do we need these statements of the obvious? The answer is that in both the UK and Europe, there remain far too many people, including senior policymakers, who refuse to accept the inevitable.