Fitch Ratings said the Brexit will weigh on the economies of other EU member states, mainly due to lower exports, and it will increase political risk in Europe.
Fitch had downgraded the U.K. ratings to ‘AA’ with a Negative outlook on Monday.
The agency noted that the impact on other EU economies will be smaller and it does not expect any other immediate negative sovereign rating actions.
“Downgrades or Outlook revisions will become more likely in the medium term if the impact on other economies proves severe or political tail risks materialize,” Fitch said.
The main driver of economic pressure will be lower exports to the U.K. A sustained significant fall in sterling would also contribute to weaker exports.
Fitch observed that the most exposed countries are Ireland, Malta, Belgium, the Netherlands, Cyprus and Luxembourg, all of whose exports of goods and services to the UK are at least 8 percent of GDP.
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