S&P Downgrades EU Credit Rating to AA Over Risks Posed by Brexit

MOSCOW (Sputnik) — The Standard & Poor's ratings agency has downgraded the European Union's credit rating down from AA+ to AA with a stable outlook due to uncertainty in the wake of last week's Brexit vote in the United Kingdom's EU membership referendum.

"After the decision by the U.K. electorate to leave the EU as a consequence of the June 23 consultative referendum, we have reassessed our opinion of cohesion within the EU, which we now consider to be a neutral rather than positive rating factor. We think that, going forward, revenue forecasting, long-term capital planning, and adjustments to key financial buffers of the EU will be subject to greater uncertainty," the agency said in a statement.

Earlier, the Fitch ratings agency said it would maintain the EU credit rating at the top AAA rating. The Brexit vote is unlikely to have an effect on EU bonds' investment grade, Fitch noted, adding that it would monitor the situation for potential outfall on other EU member states' allegiance to the bloc.

In late June, Standard & Poor's also cut the United Kingdom's credit rating from AAA to AA, while Fitch downgraded the country's bonds to AA from AA+. Both agencies gave the United Kingdom a negative outlook over concerns that Brexit might have on its economy, public finances and political stability.

On June 23, the United Kingdom held a referendum to determine whether or not the country should leave the European Union. According to the final results, 51.9 percent of voters, or 17.4 million people, decided to support Brexit, while about 16.1 million opposed it.