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Fitch cuts US credit outlook to 'negative' due to budget loss amid Covid-19

"There is a growing risk that US policymakers will not consolidate public finances sufficiently to stabilize public debt after the pandemic has passed," said the statement

Topics
Fitch Ratings | US economic outlook | US budget deficit

IANS  |  Washington 

Fitch rating agency
Fitch expected the US economy to contract by 5.6 per cent in 2020 and recover by 4 per cent in 2021

Fitch Ratings, a credit rating agency, said that it has lowered USA's economic outlook to "negative" from "stable" due to high budget deficits, but kept its overall rating at the highest "AAA" level.

The downgrade is due to the ongoing deterioration in the US public finances and the absence of a credible fiscal consolidation plan amid the Covid-19 pandemic, said in a statement, Xinhua news agency reported on Saturday.

"There is a growing risk that US policymakers will not consolidate public finances sufficiently to stabilize public debt after the pandemic has passed," said the statement from the American agency.

Fitch expected the US to contract by 5.6 per cent in 2020 and recover by 4 per cent in 2021, with the massive fiscal policy response averting a deeper downturn, according to the statement.

 

First Published: Sun, August 02 2020. 10:08 IST
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