U.S. rating at risk of negative outlook: Fitch
NEW YORK (Reuters) - Fitch Ratings does not rule out slapping a negative outlook on the U.S. AAA rating when it concludes a review of the country later this month, the agency's top analyst for the United States said on Tuesday.
David Riley told Reuters in an interview that the ongoing review will take into account the "positive" outcome of a debt agreement achieved by lawmakers on Tuesday and prospects for the U.S. economy, which have disappointed Fitch.
"The downward revisions of the GDP were bigger than we expected and a source of concern," Riley said. "There could be a rating action which could include a revision of the outlook. I certainly couldn't rule that out."
Riley stressed that the debt deal agreed by Republicans and Democrats in Washington -- which avoided an imminent debt default and promised deficit reduction measures of at least $2.1 trillion over 10 years -- is a positive development but "won't be enough to stabilize the level of public debt" in relation to the size of the U.S. economy.
He said Fitch gave a "partial thumbs up" to the plan.
The deal includes initial spending cuts of 917 billion and additional savings of $1.5 trillion that will be recommended by a congressional committee by the end of the year.
"Even if the congressional committee is successful and agree on 1.5 trillion (in deficit-reduction measures), more will likely be required to be agreed over the coming years," Riley said.