Credit ratings agency Fitch Ratings on Wednesday said a failure by U.S. officials to raise the federal debt ceiling in a timely manner would prompt it to review the U.S. sovereign rating, “with potentially negative implications.”
Fitch, which currently assigns the United States its highest rating — “AAA” — said in a statement that the prioritization of debt service payments over other government obligations, should the debt ceiling not be raised, “may not be compatible with ‘AAA’ status.”
The U.S. sovereign debt rating is Fitch’s measure of confidence in the soundness of the U.S. economy.
Without the ability to sell more debt, the government is expected to run out of cash, possibly in early October, and faces the risk of not paying the interest and principal on its debt on time. The United States defaulting on its bonds, traders fear, would rattle financial markets worldwide.
Congress has not reached a deal to raise the