June 17, 2024

Fitch setzt Ausblick für Grossbritannien und Bank of England herab

Fitch downgrades Bank of England and Bank of England credit ratings | 06.10.22

As announced by the agency, it lowered the outlook for both the country’s rating and the central bank’s rating from stable to negative.

Fitch attributed the deteriorating outlook for the UK to the “large, unfunded fiscal package announced as part of the government’s new growth plan”. This could lead to a “significant increase” in the budget deficit in the medium term. Fitch expects the deficit this year to be 7.8 percent of gross domestic product and next year to 8.8 percent if there are no compensating measures.

“The change in the fiscal position will raise the public debt ratio to 109 percent of GDP by 2024 from 101 percent in 2022, reflecting both a higher primary deficit and a weak growth outlook,” Fitch said. The agency also noted that government bond yields have risen in recent months. Fitch expects inflation to be 8.9 percent this year, and is expected to drop gradually to 4 percent by 2024.

The Bank of England’s credit rating is directly in line with the UK’s credit rating.

Fitch rates both the UK and the Bank of England at AA-.

Standard & Poor’s recently put the outlook for Great Britain into negative territory due to rising financial risks.

Written by Stephen Nacrozes

London (Dow Jones)