Fitch warns of debt ceiling deadlock may put pressure on U.S. sovereign credit ratings

According to Xinhua News Agency, Fitch, an international credit rating agency, issued a statement on October 1 stating that if the United States remains deadlocked over raising the federal government debt ceiling or suspending the debt ceiling, the sovereign credit rating of the United States will be under pressure. U.S. Treasury Secretary Yellen warned on September 28 that if the U.S. Congress does not resolve the debt ceiling issue in time, the U.S. Treasury Department will run out of debt space on October 18, and the federal government will face its first debt default in history.

Fitch said that the failure to raise the debt ceiling by October 18 is the main tail risk faced by the US sovereign debt’s willingness to pay and ability to pay. If this situation seems likely to happen, Fitch will reassess the sovereign credit rating of the United States.