- U.K. remains one of the few countries on a negative outlook
- Fitch could change U.K’s credit rating as borrowing returned to pre-2008 financial crisis levels
- “From a public finance perspective, things have been improving more quickly than we thought,” James McCormack said.
Better-than-expected data and improving public finances mean there could be an opportunity for ratings agency Fitch to take a more positive view on the United Kingdom.
James McCormack, global head of sovereigns at Fitch Ratings, hinted to CNBC’s Joumanna Bercetche that the agency could change the U.K’s credit rating as government borrowing returned to pre-2008 financial crisis levels this year.
“From a public finance perspective, things have been improving more quickly than we thought,” he said. “There’s some scope for a more positive view of the U.K.”
He added that the U.K economy didn’t perform “as bad as anticipated” in the immediate aftermath of the Brexit vote and said that Fitch’s assessment wasn’t all related to Brexit.
Speaking at the World Bank and International Monetary Fund’s Spring Meeting 2018 in Washington, McCormack said: “Growth numbers have been better, but not great.” Sterling soared to its highest level Tuesday since the U.K.’s vote to leave the EU in June 2016.
McCormack said that threats of a trade war between the U.S. and China “has to get a lot worse” before making an impact on the overall growth of the global economy.
Also at Spring Meetings 2018, IMF Deputy Managing Director Tao Zhang told CNBC’s Bercetche that clouds could be looming on the horizon for the global economy.
Zhang said there are currently three big challenges facing the global economy: tensions on the trade front, fiscal and financial risk, and the ongoing struggle to attain inclusive growth.