Whether this is case of punishment for exiting or actual concern remains to be seen, although the former is quite plausible. The S&P has in the past been used as an economic warfare tool by the American government to bend or break nations to its will.
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Standard & Poor’s on Monday downgraded the United Kingdom’s sovereign credit rating by two notches, from “AAA” to “AA,” citing last week’s referendum that approved a British exit from the European Union.
“In our opinion, this outcome is a seminal event, and will lead to a less predictable, stable, and effective policy framework in the U.K. We have reassessed our view of the U.K.’s institutional assessment and now no longer consider it a strength in our assessment of the rating,” the ratings agency said in a news release.
S&P also expressed concern that wide-margin votes to remain within the EU from Scotland and Northern Ireland create “wider constitutional issues for the country as a whole.”
The ratings agency said its downgrade notes the risk of a “marked deterioration of external financing conditions in light of the U.K.’s extremely elevated level of gross external financing requirements.”
S&P also warned that future events could result in further downgrades.
Full article: S&P cuts UK credit rating on Brexit fears (CNBC)
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