US shutdown unlikely to harm debt rating: Fitch
227 total views, 2 views today
A possible shutdown of the US federal government at midnight Friday amid a congressional deadlock on spending would have no immediate effect on America’s sovereign debt rating, ratings agency Fitch said.
The prospect of a partial shutdown of US government operations, the first in more than four years, grew increasingly likely on Friday afternoon as Senate Republicans and Democrats remained at loggerheads over legislation to authorize funding to keep the government open.
In a statement on Friday, Fitch said partial shutdowns had occurred in the past and the one looming at midnight on Friday “does not have a direct impact” on the top-notch AAA/stable rating for US sovereign debt.
“Its main implication for the US’s sovereign creditworthiness would depend on whether it foreshadowed a further destabilization of US budget policymaking, or brinkmanship over the federal debt limit,” Fitch said.
The agency cited Congressional Budget Office findings, according to which the federal government is not likely to exhaust its borrowing ability until late March or early April.
Markets appeared unconcerned by the possible shutdown on Friday, with Wall Street and the US dollar relatively stable — although US currency has weakened in recent weeks against the euro. (AFP)