Fitch sounds the alarm on US debt as it revises outlook of world’s largest economy – The National

Fitch sounds the alarm on US debt as it revises outlook of world’s largest economy – The National

The ratings agency expects government debt - the highest of any AAA-rated sovereign - to exceed 130% of GDP by 2021

Fitch ratings agency revised its outlook on the US' AAA rating to negative as the world's largest economy's national debt topped $26.5 trillion (Dh97tn) in June and it continues to grapple with the coronavirus health crisis.

Though the country's AAA rating was not changed, the revision in outlook is a reflection of "the ongoing deterioration in the US public finances and the absence of a credible fiscal consolidation plan“, the ratings agency said.

The outlook revision of the US is the first major action by an agency since Standard & Poor's downgrade of the country's sovereign rating to AA-plus from its triple A status during the global financial crisis in 2011.

Fitch's action comes as the US continues to battle the highest number of Covid-19 infections in the world and policymakers in Washington argue over the size of a second stimulus package that tops the fiscal stimulus and monetary measures rolled out already.

The number of people in the US infected with Covid-19 rose to more than 4.5 million, equivalent to more than a quarter of all cases globally. As of August 1, the