The Chinese credit rating agency, Dagong Global Credit Rating Co. Ltd, downgraded the United States local and foreign currency rating from A to A- with a negative outlook
Dagong said, “although the U.S. federal government managed to avoid a default crisis for the moment, its solvency remains vulnerable as for a long time the U.S. government has maintained its solvency by repaying its old debts through raising new ones, said the agency.”
“The government is still approaching the verge of a default crisis, a situation that cannot be substantially alleviated in the foreseeable future,” Dagong noted, adding the partial U.S. government shutdown is an inevitable outcome of its long-term failure to pay excessive debts.
AFP – A Chinese ratings agency downgraded its US sovereign credit rating Thursday despite Washington’s resolution of the debt ceiling deadlock, warning that fundamentals for a potential default remained “unchanged”.
Dagong lowered its ratings for US local and foreign currency credit from A to A-, maintaining a negative outlook, the agency said in a statement.
The announcement came after the US Congress passed and President Barack Obama signed a bill that extends the nation’s borrowing authority and ends a two-week government shutdown.
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