U.S. fiscal standoff in Feb unlikely to hit rating -Moody's analyst
NEW YORK Oct 17 (Reuters) - A possible repeat early next year of the recent congressional spending standoff would be unlikely to affect the United States' sovereign credit rating, a Moody's analyst said on Thursday.
Another fiscal impasse would not affect the country's long-term debt rating, according to Moody's.
Most of the U.S. federal government shut down for the first half of October as Republican lawmakers sought to undermine President Barack Obama's signature health care law as a condition for funding the government.
In addition, the country faced the possibility of default as the debt ceiling approached, another policy flashpoint.
An 11th-hour deal will fund the government through mid-January, with the country's borrowing authority raised until Feb. 7.
That deal, though, raises the possibility of a reprise of the bruising battles early in 2014.
"We would probably take the same rating stance again in February if there was another standoff like we witnessed," Steven Hess, lead U.S. sovereign credit analyst at Moody's Investors Service, said in an interview with Reuters.
Moody's maintained through the standoff that its analysts believed the debt ceiling would be raised and default avoided.
In addition, the rating agency also said that the debt debates were short-term events and that the agency's triple-A rating of the United States is based on the country's long-term debt trajectory. The rating carries a stable outlook.
"We don't think that all of this really has a rating implication," Hess added.
"The actual debt limit, we believe, is always going to be raised. It's a matter of timing. The timing can create uncertainty and financial market stress, but in the end it gets raised."
The United States lost its triple-A rating from Standard & Poor's two years ago on concerns about political dysfunction during another debt ceiling impasse; the agency now rates the county AA-plus with a stable outlook.
Fitch, however, placed the U.S. triple-A on Ratings Watch Negative, signaling that the political brinkmanship in Washington could lead to a cut.
Still, Hess cautioned that Moody's position could change as negotiations among lawmakers continue and the country's debt trajectory evolves.
"We could be surprised by events," he said.