THE UK has been moved on to a poorer risk rating by business information company Dun & Bradstreet, with the country now ranked joint second-worst among the Group of Seven leading industrialised nations behind only Italy.

Dun & Bradstreet said yesterday that it had downgraded the UK’s risk rating from DB2c to DB2d, citing the increasing likelihood of a “hard Brexit” scenario involving loss for the UK of free access to the European Union single market.

It noted this move followed a rating change from DB2a to DB2c on June 24, immediately after the EU referendum result.

Markus Kuger, senior economist at Dun & Bradstreet, warned UK companies should be taking “appropriate risk management measures” and declared that sterling weakness would prompt rising inflation.

He added: “With the pound having already fallen to a six-year low against the euro, companies should be taking the appropriate risk management measures. Businesses must carefully assess growth opportunities, while preparing for the changes that Brexit will bring.”

Assessing the UK’s prospects, Dun & Bradstreet said: “Although industrial and consumer confidence indicators remain positive, bolstering the short-term economic outlook, Dun & Bradstreet analysis indicates that the increasing likelihood of a ‘hard Brexit’ warrants a further downgrade.”

Dun & Bradstreet observed that, before yesterday’s downgrade, the UK had been on a par with Canada and Singapore, but now rated the same as Belgium.

It added that, together with Japan and France, the UK was now ranked the “second-worst G7 economy, only ahead of Italy”, behind Germany, on DB1d, the US, on DB2a, and Canada, which has been raised from DB2c to DB2b in the latest report from Dun & Bradstreet.

Citing official data on Thursday showing a slowdown in UK growth to 0.5 per cent in the third quarter, from 0.7 per cent in the preceding three months, Mr Kuger said: “The value of the pound has fallen, counterbalancing some of the immediate adverse impacts of June’s Brexit vote. Worryingly, the UK’s preliminary GDP (gross domestic products) growth figures for Q3 slowed to 0.5 per cent, and the weaker currency will prompt rising inflation figures and reduce opportunities for exporters selling to the UK.

“However, while it’s true that uncertainty from the EU referendum is clouding the medium to long-term outlook, this is not a time for panic or rash decision-making. The outcome of Brexit remains unclear, and it will not be clarified until at least two years after Article 50 is invoked.”