Fitch has downgraded a record number of sovereign ratings due to the coronavirus. It’s not done yet

Fitch has downgraded a record number of sovereign ratings due to the coronavirus. It’s not done yet

Fitch Ratings has downgraded a record 33 sovereign ratings in the first half of this year “” and the agency is not done yet as the coronavirus pandemic pummels government finances.

James McCormack, Fitch's global head of sovereign ratings, said the agency has placed the credit ratings of 40 countries or sovereign entities on a "negative" outlook. That means those ratings have the potential to be downgraded.

"We've never in the history of Fitch Ratings had 40 countries on negative outlook at the same time," he told CNBC's "Capital Connection" on Friday.

"That comes after we've already downgraded in the first half of the year 33 sovereigns. We've never downgraded 33 in any given year, so we've already done it in half a year," he added.

Sovereign credit ratings that Fitch has downgraded include the U.K., Australia and Hong Kong.  

McCormack explained many governments have increased spending to shelter their economies from being severely hit by the coronavirus pandemic. That's expected to cause a deterioration in the financial positions of all 119 countries rated by Fitch, he said.

The office of Fitch Ratings in New York.

Cem Ozdel | Anadolu Agency | Getty Images

Such deterioration could take the form of larger deficits or smaller surpluses in