Fitch Ratings downgraded the United States’ long-term foreign-currency issuer default rating (IDR) from “AAA” to “AA+” on August 1, raising concerns among global investors about the U.S. credit. This is the second time in America’s history that a top-three U.S. ratings firm has downgraded its IDR, after Standard & Poor’s in 2011 lowered its rating one notch below the top grade. The move leaves Moody’s as the only of the three big ratings firms still giving the U.S. the AAA rating.
Why did the rating agency choose to downgrade the U.S. sovereign rating at this time, despite the bipartisan agreement in early June to suspend the debt limit until January 2025? According to a report released by Fitch
