S&P cuts rating on EU to 'AA' after Brexit
Published 01/07/2016 | 07:15
Standard & Poor's Global Ratings said on Thursday it had cut its long-term credit rating on the European Union to 'AA' from 'AA+' but raised its outlook to "stable" from "negative" after the United Kingdom voted to leave the bloc.
S&P is the first major ratings agency to cut rating on the EU. Moody's maintained its 'AAA' rating last week.
"After the decision by the UK electorate to leave the EU...we have reassessed our opinion of cohesion within the EU, which we now consider to be a neutral rather than positive rating factor," S&P said.
The UK voted to leave the European Union last week, plunging global markets into turmoil.
S&P said the UK's exit from the EU would complicate budgetary and policy priorities among the remaining 27 members, which could weaken the bloc's fiscal stability.
The ratings agency said its stable outlook reflected its view that no other member states would leave the EU.