10/17/2020, 8:51 AM (Source: TeleTrader)
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Moody's cuts UK's debt rating over Brexit worries

Moody's cut the United Kingdom's debt rating after Britain failed to reach a comprehensive post-Brexit trade deal with the European Union by the deadline it set itself.

On Friday, Downing Street said trade negotiations between the two sides were effectively ended by the EU when the bloc refused to "change their negotiating position" and UK Prime Minister Boris Johnson noted the country should prepare for a no-deal scenario once the transition period ends on December 31.

"Even if there is a trade deal between the UK and EU by the end of 2020, it will likely be narrow in scope," Moody's stressed. The ratings agency also stated that the negative impact of COVID-19 and the fact that the UK "effectively has no fiscal policy anchor" also influenced its decision to lower its rating.

Baha Breaking News (BBN) / NP