Egan-Jones downgrades U.S. credit rating to AA- from AA

NEW YORK, Sept 14 Fri Sep 14, 2012 3:43pm EDT

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NEW YORK, Sept 14 (Reuters) - Ratings agency Egan-Jones on Friday downgraded the U.S. country rating to AA-minus from AA, citing the Federal Reserve's latest stimulus program to boost the sluggish economy.

The Fed on Thursday said it would pump $40 billion into the U.S. economy each month until it saw a sustained upturn in the weak jobs market.

"(The) Fed's QE3 will stoke the stock market and commodity prices but in our opinion (it) will hurt the U.S. economy and, by extension, credit quality," Egan-Jones said in a statement about the latest quantitative easing program.

"The increased cost of commodities will pressure profitability of businesses, and increase the costs of consumers thereby reducing consumer purchasing power."

Moody's Investors Service currently rates the United States Aaa, Fitch rates the country AAA, and Standard & Poor's rates the country AA-plus. All three of those ratings have a negative outlook.

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