Fitch Credit Agency Puts USA Credit Rating on Negative Watch

The Fitch credit rating agency has warned that it is reviewing the U.S. government’s AAA credit rating for a possible downgrade, citing the impasse in Washington that has raised the threat of a default on the nation’s debt.

From the Fitch website:

Fitch Places United States’ ‘AAA’ on Rating Watch Negative
Fitch Ratings has placed the United States on Rating Watch Negative on the high risk that US authorities will not raise the debt ceiling in a timely manner before the Treasury exhausts extraordinary measures on 17 Oct.

Fitch placed the U.S. credit rating on negative watch Tuesday, a step that would precede an actual downgrade. The agency said it expects to conclude its review within six months.

The announcement comes as House and Senate leaders face a Thursday deadline to raise the nation’s $16.7 trillion borrowing limit. Fitch says it expects the debt limit to be raised soon. But it adds, “the political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default.”