Fitch may cut Britain’s AA debt rating due to Brexit
NEW YORK: Ratings agency Fitch warned on Wednesday that it could cut Britain's debt rating.
The country's departure from the European Union without a divorce agreement would create a risk of "substantial disruption to UK economic and trade prospects, at least in the near term", Fitch said.
Fitch put Britain's long-term debt on credit watch "negative" for a possible downgrade from the AA rating.
The review date had been set for April 26, but Fitch said "developments in the country warrant such a deviation from the calendar".
This came as British Prime Minister Theresa May met European Commission president Jean-Claude Juncker in Brussels.
Fitch said it still expects Britain will avoid a no-deal Brexit and economic growth will pick up, but warned the consequences could be serious if no agreement is reached.
"The impact of a 'no-deal' Brexit on growth is highly uncertain, but a recession on the scale of that seen in the UK in the early 90s (when real gross domestic product declined by 2 per cent over six quarters) would be a reasonable comparison for gauging the potential macroeconomic stress," Fitch said. - AFP
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