The Fitch Ratings agency downgraded United Kingdom's long-term Issuer Default Ratings rating to 'AA-' from 'AA' with a negative outlook.
“The downgrade reflects a significant weakening of the UK’s public finances caused by the impact of the COVID-19 outbreak and a fiscal loosening stance that was instigated before the scale of the crisis became apparent,” it said.
It also emphasized that uncertainty on the trade relationship with the European Union after Brexit affected the decision.
“The downgrade also reflects the deep near-term damage to the UK economy caused by the coronavirus outbreak and the lingering uncertainty regarding the post-Brexit UK-EU trade relationship,” Fitch said.
It added that general government debt will rise to 94% and 98% in 2020 and 2021, respectively, from 84.5% in 2019.
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