Fitch says it puts 11 US credit-linked notes on negative watch
https://sputnikglobe.com/20230527/fitch-says-places-11-us-credit-linked-notes-on-rating-watch-negative-1110622881.html
Fitch says it puts 11 US credit-linked notes on negative watch
Fitch says it puts 11 US credit-linked notes on negative watch
WASHINGTON, (Sputnik) — Fitch Ratings said Friday it placed 11 U.S. credit-linked notes on a “Rating Watch Negative,” citing growing risks the government administration could begin to default as the Biden administration remains locked in a political showdown with its rivals to raise the national debt ceiling.
2023-05-27T04:47+0000
2023-05-27T04:47+0000
2023-05-27T04:47+0000
americas
Joe Biden
janet yellow
Kevin McCarthy
republicans
Fitch
US debt ceiling crisis
debt ceiling
our debt
default
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“Fitch still expects a resolution of the debt limit before date x,” the rating agency said of the June 5 deadline that US Treasury Secretary Janet Yellen gave as the last day. where the government can pay its obligations without default. Despite his optimism that the administration will resolve the crisis in time, Fitch said he believed “the risks have increased that the debt ceiling will not be raised or suspended by date x and therefore… the government may begin to miss payments on some of its obligations.” Yellen told Congress in a letter Friday that based on the most recent data, the Treasury would not be able to meet its obligations if the limit of the national debt, which currently stands at $31.4 trillion, was not raised by June 5. Earlier, the Treasury Secretary cited June 1 as the likely default date with no higher debt ceiling President Joe Biden and his Democratic allies negotiated unsuccessfully for weeks with Republican Congress Leader Kevin McCarthy, who is also Speaker of the United States House of Representatives, for a new deal on the country’s debt. McCarthy said Wednesday that he and other Republicans are still “at a distance” with Democrats on various issues, though he and Biden have repeatedly stressed that “default is not an option.” At the heart of the disagreement is how much the government should – or shouldn’t – spend next year. While any deal reached now will only cover 2023 obligations, Republicans are running the ball forward to also tie federal commitments for 2024. With legacy US debt already at $21.5 trillion and growing every year, Republicans say the country can’t continue with Democrats’ overspending. House Republicans passed a plan last month to raise the debt ceiling in exchange for government spending cuts, but Biden and Senate Majority Leader Chuck Schumer quickly rejected the proposal. Democrats, for their part, are outraged by Republicans’ refusal to raise taxes on the wealthy — a privileged group who Biden says have never paid their fair share of the country’s revenue — and are seeking to increase the budget of defense — a favorite political game for Republicans, who have traditionally enjoyed strong support from the military and other uniformed personnel.
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americas
2023
News
en_GB
american economy, deb cap, debt limit, yellen, deal
american economy, deb cap, debt limit, yellen, deal
WASHINGTON, (Sputnik) — Fitch Ratings said Friday it placed 11 U.S. credit-linked notes on a “Rating Watch Negative,” citing growing risks the government administration could begin to default as the Biden administration remains locked in a political showdown with its rivals to raise the national debt ceiling.
Despite his optimism that the administration will resolve the crisis in time, Fitch said he believed “the risks have increased that the debt ceiling will not be raised or suspended by date x and therefore… the government could start to miss payments on some of its obligations.”
Thus, the rating agency indicated that it had placed 11 credit-linked notes, or CLNS, on negative watch. “CLN ratings are directly dependent on the US sovereign rating, Fannie Mae or Freddie Mac and will be downgraded if the ratings are downgraded,” Fitch added.
Yellen told Congress in a letter Friday that based on the most recent data, the Treasury would not be able to meet its obligations if the national debt limit, which currently stands at $31.4 trillion. , was not relieved by June 5.
Earlier, the Treasury Secretary cited June 1 as the likely default date without a higher debt cap.
President Joe Biden and his Democratic allies negotiated unsuccessfully for weeks with Republican Congress Leader Kevin McCarthy, who is also Speaker of the United States House of Representatives, for a new deal on the country’s debt.
McCarthy said Wednesday that he and other Republicans are still “at a distance” with Democrats on various issues, though he and Biden have repeatedly stressed that “default is not an option.”
At the heart of the disagreement is how much the government should – or shouldn’t – spend next year. While any deal reached now will only cover 2023 obligations, Republicans are kicking the ball to also tie federal commitments for 2024. With US legacy debt already at $21.5 trillion and growing every year, Republicans say the country can’t continue with Democrats’ overspending.
House Republicans passed a plan last month to raise the debt ceiling in exchange for government spending cuts, but Biden and Senate Majority Leader Chuck Schumer quickly rejected the proposal.
Democrats, for their part, are outraged by Republicans’ refusal to raise taxes on the wealthy — a privileged group who Biden says have never paid their fair share of the country’s revenue — and are seeking to increase the budget of defense — a favorite political game for Republicans, who have traditionally enjoyed strong support from the military and other uniformed personnel.
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