RATINGS agency Standard and Poor’s has cut its credit rating for the European Union in the wake of the UK’s vote for Brexit.

S&P Global Ratings said it was lowering its long-term rating on the European Union from AA+ to AA after Britain’s vote to leave triggered “greater uncertainty” over the EU’s revenue forecasting, long-term capital planning and adjustment to key financial buffers.

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It said it had to review its “previously favourable opinion of solidarity within the EU” from positive to neutral because its previous view was based on all 28 member states staying in.
The agency added: “The rating action stems from S&P Global Ratings’ view that the UK government’s intention to leave the union lessens the supranational’s fiscal flexibility.

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“While we expect the remaining 27 members to reaffirm their commitment to the Union, we think the UK’s departure will require new and complicated negotiations on the next seven-year budgetary framework.”