⁍ Moody’s lowered the rating to ‘Aa3’ from ‘Aa2,’ putting Britain on the same level as Belgium and the Czech Republic.
⁍ The world’s sixth-biggest economy shrank by the most among Group of Seven nations in the second quarter.
⁍ Britain faced a sharper peak-to-trough contraction due to the severity of its COVID-19 outbreak.
– Moody’s has followed Fitch and Standard & Poor’s in downgrading Britain’s credit rating. The agency cut the country’s rating to “Aa3” from “Aa2,” putting it on par with Belgium and the Czech Republic, reports Reuters. Moody’s cited Britain’s weak economic growth, high debt, and “lack of clear budget plans” as reasons for the move, which comes a day after Prime Minister Boris Johnson said negotiations on a Brexit deal with the European Union were over, reports the BBC. Moody’s said that even if a trade deal is reached, it would be “narrow in scope” because of Britain’s lack of fiscal discipline. “The UK effectively has no fiscal policy anchor,” it said. “Over time and as the economy recovers, the government will take the necessary steps to ensure the long-term health of the public finances,” a finance ministry spokesman said.
Source: https://www.reuters.com/article/britain-ratings-moodys/update-3-moodys-downgrades-uk-as-covid-19-and-brexit-hit-debt-outlook-idUSL4N2H73RY