Fitch warns US of credit rating review
16 Jan 2013
Global credit ratings agency Fitch Ratings yesterday warned the US, that it could lose its top credit rating for the second time if there was a delay in raising its debt ceiling.
Fitch, which already has a negative outlook on the US, said it would make a decision on the rating this year, regardless of the result of debt ceiling discussions.
After reaching its statutory debt limit of nearly $16.4 trillion at the end of 2012, the US government has had to take recourse to extraordinary measures to see it through February.
According to David Riley, managing director of Fitch Ratings' global sovereigns division, the pressure on the US rating was increasing. He added it had been thought that the 2011 crisis was a one-off event but if it was needed the agency would place the US rating under review.
Meanwhile, Congress has to enhance the country's debt limit, which effectively ruled how much debt the US could have by 1 March or face a potential default.
Fears are being expressed in some quarters that the debate would end up in a blame game and a show of political brinkmanship like the last effort to raise the ceiling in the summer of 2011.