Fitch, a global ratings agency, has upgraded the United Kingdom’s sovereign credit outlook from ‘negative’ to ‘stable,’ while affirming its sovereign credit rating at ‘AA-.’

The decision follows a positive turn in Britain’s economy, which rebounded to growth in January after experiencing a shallow recession in the latter half of 2023. The recovery was propelled by a resurgence in retail sales and housing activity.

Fitch stressed cautious projections, anticipating a balance in policy priorities aimed at mitigating risks to the sustainability of public finances. Bank of England Governor Andrew Bailey also expressed optimism about the UK’s economic trajectory, noting encouraging signs of inflation easing. However, Bailey stressed the need for further assurance that price pressures are fully managed.

Similarly, other rating agencies such as S&P and Moody’s have maintained a stable outlook on the United Kingdom.