S&P warns Britain likely to lose its AAA credit rating after Brexit
Credit ratings agency Standard & Poor's has warned Britain could lose its AAA credit rating, after it voted for Brexit heralding a period of political, economic and financial uncertainty.
Moritz Kraemer, chief ratings officer for S&P, reiterated that he expected the risks associated with the UK voting to leave the European Union will lead to a credit downgrade in the near-future.
Read more: It will be months, rather than days, before the UK leaves the EU
Prime minister David Cameron and Bank of England governor Mark Carney are due to deliver speeches today. Former Bank rate-setter Danny Blanchflower told City A.M. that "Brexit will spell the end of David Cameron, George Osborne and Mark Carney," due to the result.
Financial markets gyrated this morning after the UK defied polls to leave the European Union in a historic referendum. Sterling haemorrhaged, while Britain's blue-chip FTSE 100 is expected to open sharply lower. However, safe havens such as gold and bonds gained.
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S&P previously said that Brexit would zap much-needed investment in buildings, roads and power supplies for at least two years after the vote. But it added that capital would return once the immediate fallout had settled.
It was based on a survey they conducted about two months ago, in which less than half of respondents said they believed that the UK was likely or very likely to leave the EU.