Moody’s downgrades UK’s credit outlook to ‘negative’
London: The global rating agency Moody’s has lowered its credit rating on the UK outlook to ‘negative’ by after the country voted to leave the EU. Moody’s said the result would herald a prolonged period of uncertainty.
Meanwhile, Prime Minister David Cameron is under pressure to speed up divorce talks with the EU after Brussels said exit negotiations should start immediately. EU head Jean-Claude Juncker said it was ‘not an amicable divorce,’ but it was ‘not a tight love affair anyway.’
Moody’s said the referendum result would have negative implications for the country’s medium-term growth outlook and it lowered the UK’s long term issuer and debt ratings to ‘negative’ from ‘stable.’
Moody’s further opined that the
negative effect from lower economic growth will outweigh the fiscal
savings from the UK no longer having to contribute to the EU budget.
It also said the UK had one of the largest budget deficits among
advanced economies.
The financial assessment came after the UK voted to leave the EU and a defeated Cameron said he would step down as leader by autumn. Pro-Leave MP Boris Johnson is tipped as favourite to replace him.
