Moody’s downgrades UK’s credit outlook to ‘negative’ after Brexit

FRANKFURT AM MAIN, GERMANY - JUNE 24: (Editors Note: This picture is taken with the in-camera multiexposure mode.) Trader sit at his desk under the day's performance board that shows a dive in the value of the DAX index of companies at the Frankfurt Stock exchange the day after a majority of the British public voted for leaving the European Union on June 24, 2016 in Frankfurt am Main, Germany. Many prominent corporate CEOs and leading economists have warned that a Brexit would have strongly negative consequences for the British economy and repercussions across Europe as well. (Photo by Thomas Lohnes/Getty Images)

Credit ratings agency Moody’s has downgraded the UK Government’s bond rating from stable to negative in light of Britain’s decision to leave the European Union.

The agency warns Britain’s economic growth will be weaker, its economic policymaking may be diminished and the government’s fiscal strength reduced.

Moody’s said: “Moody’s expects a negative impact on the economy unless the UK government manages to negotiate a trade deal that largely replicates its current access to the Single Market.

“However, at the moment there is substantial uncertainty over the type of trade agreement that could be achieved.”

The agency also affirmed Britain would remain on the AA+ rating, three years after it cut Britain’s AAA rating.

Some have suggested financial markets have been engulphed by a “Black Friday” as traders around the world responded to the consequences of Britain’s exit from the EU.

Courtesy: Independent