Biden officials protest ‘bizarre’ Fitch downgrade, cite Trump-era woes
- Fitch dropped the rating to AA+, citing an expected fiscal deterioration over the next three years as well as a high and growing government debt burden
- US Treasury Secretary Janet Yellen said she disagreed with the downgrade, calling it ‘arbitrary and based on outdated data’
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Biden administration officials complained on Tuesday about ratings agency Fitch’s downgrade of the top US government credit rating, saying the group used flawed methodology and ignored a resilient economy.
Leading the charge was US Treasury Secretary Janet Yellen, who said she disagreed with Fitch’s downgrade to AA+ from AAA, in a statement that called it “arbitrary and based on outdated data”.
Fitch’s report cited “a steady deterioration in standards of governance over the last 20 years” and said “repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management”.
The move comes two months after a bruising partisan fight over the federal debt ceiling, which was ultimately raised. It echoes a US downgrade in 2011 by rival ratings agency Standard and Poor’s, days after a similar debt ceiling fight also threatened a US default.
Biden administration officials told reporters governance issues cited by Fitch occurred during the administration of then-President Donald Trump, Joe Biden’s predecessor. Still, the agency kept the rating at AAA during those years, they said.
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