EXCLUSIVE: Fitch downgraded the US credit rating due to fiscal concerns, a deterioration in US governance, and political polarization reflected partly by the Jan. 6 insurrection, Richard Francis, a senior director at Fitch Ratings, told Reuters
to AA+ from AAA on Tuesday, citing fiscal deterioration over the next three years and repeated down-to-the-wire debt ceiling negotiations that threaten the government’s ability to pay its bills.
"It was something that we highlighted because it just is a reflection of the deterioration in governance, it's one of many," he said. in their decision to cut the U.S. pristine rating, which they said at the time was due to heightened political polarization and insufficient steps to right the nation's fiscal outlook.
When asked about the timing of Fitch’s decision, Francis said the agency wanted to take some time after the recent debt deal to asses long-standing concerns around governance and the debt profile of the country.Francis said the decision to cut the country's top rating, which was taken on Monday, resulted from a worsening of the country's debt profile - for instance, the ratio between the U.S.
The latest debt ceiling suspension, agreed in June, will last until early 2025, when another political debate around the borrowing limit is likely, he added.
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