Economy “Outlook stable”
Fitch revokes US top credit rating
Status: 00:48 | Reading time: 2 minutes
The rating agency Fitch justifies its decision, among other things, with the high national debt
Quelle: bye/NurPhoto/Jakub Porzycki
In 2011, Standard & Poor’s lowered the US credit rating to AA+. Now Fitch follows this decision and points to the struggles between Democrats and Republicans. Treasury Secretary Janet Yellen criticized the new classification.
The rating agency Fitch has withdrawn the coveted top credit rating from the United States. The rating was lowered by one step from AAA to AA+, as Fitch announced on Tuesday. Fitch is catching up with its competitor S&P, which had already lowered the US rating to AA+ in 2011. The third agency, Moody’s, maintains the highest rating, AAA.
Fitch’s new rating reflects expected worsening fiscal conditions over the next three years and high and growing public debt, the US agency said on Tuesday. The outlook is stable.
The air is getting a little thinner for the American government on the debt market. Because conservative investors like to avoid paper that doesn’t have the best rating. All the more so, the more of the big agencies do not award it.
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The deficit is likely to increase to 6.3 percent of economic output (GDP) this year, 6.6 percent next year and further increase to 6.9 percent in 2025. US Treasury Secretary Janet Yellen said in an initial statement that she disagreed with the decision.
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In justifying the decision, Fitch referred, among other things, to the high level of debt in the United States and the repeated struggles between Republicans and Democrats in Congress over the budget. Tax cuts and higher-spending investment programs would have led to even higher government debt.
When it withdrew its AAA rating in 2011, Standard & Poor’s also pointed out the partisan differences that make it difficult for the world‘s largest economy to control its spending or increase taxes sufficiently. Fitch had already announced a rating downgrade in May of this year.
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