Global financial ratings' giant, Fitch has warned that it is considering downgrading UK's AAA credit status due to rising level of debt and a lack of growth in the British economy.

The agency said that lower growth and high level of debt might result in downgrade in the near term. The agency said that it is preparing a report on the budget presented and many believe that the analysts will downgrade UK of the second of its three AAA ratings in the report. The UK government will only determine in April if it has faced a triple-dip recession.

The agency said that the latest downgrade illustrates "the latest economic and fiscal forecasts published by the Office for Budget Responsibility that indicate that UK government debt will peak later and at a higher level than previously expected by Fitch."

The British economy shrank 0.3 per cent during the quarter from October to December, 2012,, which was the second straight quarter of contraction. If the economy records a third consecutive quarter of negative growth, the business sentiment could be serious affected in the country and could derail the fragile recovery in the UK economy.

Figures to be released by the Office for National Statistics is likely to show that the UK might have avoided contraction during this quarter till March, 2013. However, several industries are facing the effects of a global economic slowdown and the European economic crisis.