S&P Global Ratings sounded a word of caution on the U.S. on Thursday.
Speaking with CNBC on the sidelines of the International Monetary Fund meetings in Washington D.C., Moritz Kraemer, the rating agency’s sovereign global chief ratings officer warned about the impact of another federal debt ceiling crisis.
“We might be looking at another debt ceiling problem going forward later in the year — that of course is very binary so if there’s no agreement, it might actually lead to a technical default,” Kraemer said.
“That certainly would be rating relevant, but that’s not our expectation.”
Back in 2011, Washington was engaged in a fierce debate over the government’s debt ceiling, which prompted S&P to downgrade the U.S. credit rating for the first time.
The ratings agency has a stable outlook on the AA+ long-term rating currently held by the U.S.
Source : CNBC