The UK has lost its top level AAA credit rating from agency Standards & Poor following the vote to leave the European Union.
S&P said the Brexit vote would lead to "a deterioration of the UK's economic performance, including its large financial services sector". It had been the only ratings agency to keep the UK at the AAA rating that the government had fought so hard to keep following the financial crisis.
The downgrade comes despite moves by various figures, including the Chancellor George Osborne, to reassure financial markets over the impact of the referendum result. Mr Osborne said on Monday that the UK is in a "position of strength" to cope with the Brexit vote.
Meanwhile, S&P's rival, Fitch, also downgraded its rating for the UK, from AA+ to AA. It predicted an "abrupt slowdown" in economic growth in Britain in the short-term.
S&P said a Brexit vote would "weaken the predictability, stability, and effectiveness of policymaking in the UK".
With the Scottish National Party threatening a second referendum on independence from the United Kingdom, S&P said it recognised the possibility of a "constitutional crisis" following the Brexit vote.
"We take the view that the deep divisions both within the ruling Conservative Party and society as a whole over the european question may not heal quickly and may hamper government stability and complicate policymaking on economic and other matters," it said.
