The UK's credit rating is at risk of being downgraded after last week's "inconclusive" general election result, Moody's has warned.
The ratings agency said a hung parliament "heightens uncertainty over Brexit negotiations and increases fiscal risks", hurting Britain's creditworthiness.
Kathrin Muehlbronner, senior vice president at Moody's, said the election result "will complicate and probably delay Brexit negotiations, a credit negative".
While the negotiations with the EU were due to begin on June 19, Ms Muehlbronner argued: "We now expect a delay to the start of those negotiations or at least a period during which no substantive issues will be discussed."
She pointed out the deadline for the UK to leave the EU in March 2019 is fixed, and therefore any delay to the start of talks will further reduce the time available to strike a transition deal to avoid a "cliff-edge" Brexit.
The agency also warned the UK's attempts to shrink its budget deficit could be undermined by the election result, in a further hit to the country's creditworthiness.
The Labour Party, which made significant gains in the general election, campaigned on a strong anti-austerity platform.
Moody's said this could mean increased public spending under a hung parliament.
With the UK economy slowing, any fiscal loosening would increase the country's debt problem.
"The public debt ratio will rise further and for longer than we had expected, placing the UK among the few highly rated European sovereigns whose public debt is still rising," Ms Muehlbronner wrote.
However, Moody's also said the lack of a decisive majority party could result in the Government pursuing a "softer" Brexit, a scenario which it described as "credit positive".
"While we still expect Brexit to happen and the 'cliff' risk of sudden exit remains, the election result suggests an electoral shift away from the 'hard' Brexit that the Prime Minister had ostensibly sought.
"Hence, a move towards 'softer' versions of Brexit, potentially with continued access of some sort to the single market, might now be considered," Moody's said.
A lower credit rating could make it more expensive for the UK to borrow money in international financial markets.
The UK already suffered a raft of downgrades to its credit outlook in the immediate aftermath of the Brexit vote.
Moody's slashed its outlook for the UK from stable to negative in June 2016.
Rival agency Fitch also lowered its rating from AA+ to AA last June, forecasting an "abrupt slowdown" in growth in the short-term.
Standard and Poor's downgraded the country's rating from AAA to AA, warning the Brexit vote would lead to ''a less predictable, stable and effective policy framework in the UK''.
Britain is currently rated Aa1 by Moody's, a notch higher than at Standard and Poor's and Fitch.