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Moody's: Britain's economy will decline by more than 10% and debt will rise
Credit rating agency Moody's warned Friday that Britain will suffer from the most severe downturn in economic decline compared to other major economies this year, and raised its estimate of public debt as a proportion of gross domestic product by about a quarter.
Moody's said that the latest stimulus package offered by the British government worth 30 billion pounds ($ 37.9 billion) announced this week will help the gradual economic recovery but will add more
Pressure on the UK's financial position.
"The UK's public debt ratio to GDP will increase by 24 percentage points or more compared to 2019 levels," a group of senior Moody's analysts wrote in the note.
"We expect the UK's GDP to contract by 10.1 percent this year, but we expect a recovery later on the back of easing public isolation measures, with growth recovering to 7.1 percent next year," she added.
Moody's ranks Britain at Aa2 with a negative outlook after a series of cuts since citizens of the country voted to exit the European Union in mid-2016.
Moody's said that very frequent indications are that economic activity is gradually recovering after hitting the bottom in April, when the economy contracted by just over 20 percent, according to estimates.
