No deal Brexit would represent “profound” failure – Moody’s

Friday, 25 January 2019 00:00 - - {{hitsCtrl.values.hits}}

Anti-Brexit protester Steve Bray packs away placards into his car after the result was announced on Prime Minister Theresa May's Brexit deal, outside the Houses of Parliament in London, Britain - REUTERS

LONDON (Reuters): A no deal Brexit would represent a major failure of Britain’s political institutions that would weigh negatively on the country’s creditworthiness, ratings agency Moody’s said on Wednesday.

“From a sovereign credit perspective, if you end up with a ‘no deal’ Brexit that is a sign that something institutionally has really quite profoundly failed,” Moody’s senior vice president Sarah Carlson told a conference in London.

Carlson said perceptions of how functional a country’s institutions were was a big factor in setting its credit rating, though Moody’s would need to disentangle short-term noise and long-term damage in the event of a disorderly Brexit. Moody’s currently rates Britain at Aa2 with a stable outlook.