Moody’s, the credit rating agency, acknowledge the positive impact of the Brexit transition deal announced last week. However, it remained cautious that risks will prevail until a final agreement is made.
Here are some highlights of the report:
- The agreement reinforces Moody’s view that the impact of Brexit will be manageable for rated UK corporate issuers, despite increased bureaucracy costs under an FTA.
- For UK banks the agreement is mildly positive to the extent that it reduces downside risks to growth and revenues.
- As far as the risk of a disorderly withdrawal is somewhat mitigated, the agreement reinforces Moody’s central scenario of gradually moderating growth in the UK.
- Uncertainty concerning the terms of UK’s future long-term relationship with the EU will prevail until a conclusive final agreement is reached.