UK may get a lower Fitch Rating

Market Trends - 21/02/2019

On Wednesday Fitch Ratings announced that it probably will lower the UK's 'AA' debt number based on the increasing skepticism about the discussions among the European Union and the UK covering the country's withdrawal from EU on the march.

Fitch believes that a 'no-deal' Brexit probably will drive to an important confusion to UK expectancies in the short term, the popular rating agency actually said "Fitch believes that a 'no-deal' Brexit would lead to substantial disruption to UK economic and trade prospects, at least in the near term."

Fitch also announced it may lower its 'AA' rating on the Bank of England if it chops the UK's sovereign rating. On Wednesday also Theresa May supported "constructive" discussions in Brussels while she asked for support covering the Brexit matter from a skeptical EU. Her plan came under pressure following the withdrawal of three lawmakers.

The British pound increased its losses shortly versus the greenback following Fitch's announcement on the UK's rating.

Time is working against May while she tries to get support from UK lawmakers before the March 29 Brexit deadline. Fitch said, "For the withdrawal agreement to be approved by the UK prior to the deadline, the government would need to substantially widen its support."

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