Credit rating agency Fitch today confirmed its triple-A rating of the US, 10 days after rival Standard & Poor's dealt the country its first-ever downgrade due to its heavy debt burden.
'The affirmation of the US 'AAA' sovereign rating reflects the fact that the key pillars of US's exceptional creditworthiness remain intact: its pivotal role in the global financial system and the flexible, diversified and wealthy economy that provides its revenue base,' Fitch Ratings said.
'Monetary and exchange rate flexibility further enhances the capacity of the economy to absorb and adjust to 'shocks',' Fitch said.
But it added that it will review its projections of the US fiscal deficit and growth expectations - problems that S&P cited in its historic downgrade - after it sees the work of a joint Congressional committee tasked with slashing $1.5 trillion from US deficits over the next 10 years by the end of November.
Fitch said that if it has to revise upward its projection of long-term public debt due to worsening economic conditions or the failure of the committee to achieve deficit cuts, it 'would likely' cut its rating for the country.
'The rating action would most likely be a revision of the rating outlook to negative, which would indicate a greater than 50% chance of a downgrade over a two-year horizon. Less likely would be a one-notch downgrade,' it added.
Earlier this month, S&P cut the long-term US credit rating by one notch to AA+ on concerns about the government's budget deficit and rising debt burden.
The other main ratings agency, Moody's, still rates the US debt at its highest grade but says its outlook is negative.
