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UK's credit rating is set to take a hit

By Ben Woods

The UK's creditworthiness is "under downward pressure" after the vote to leave the European Union, according to a report.

A study by credit ratings agency Moody's said the UK should brace itself for a hit following the Brexit vote, with uncertainty impacting economic growth and weakening government finances.

Moody's expects UK gross domestic product (GDP) to hit 1.5% this year, before slipping back to around 1% in 2017.

However, the UK's large economy, its "solid institutional strength", flexible labour market and high wealth levels will help to reinforce its credit position, according to its annual credit analysis report.

Kathrin Muehlbronner, senior vice president at Moody's, said: "The economy will slow significantly in the near term, and medium-term growth prospects could be materially weaker if the UK failed to reach a new trade arrangement with the EU that allows it reasonably good access to the European Single Market.

"Given the complexity and sheer amount of economic policy decisions in the coming years, the UK's institutions will be tested."

Belfast Telegraph