S&P: US Will Not Regain AAA Quickly
Standard & Poor's says it cannot see the US getting its triple-A rating back anytime soon. In a conference call on Monday, the head of S&P's sovereign rating committee John Chambers said that historically the shortest time it has taken a sovereign to regain its triple-A rating was nine years.
S&P global head of sovereign ratings David Beers said: "We don't anticipate a scenario at the moment in which the US would quickly return to triple-A." Beers said that if US political parties were able to show consensus on how to cut the deficit then it could be reinstated more quickly.
"If that were to change and there was a broader consensus among the parties on how to make fiscal policy choices over the medium-term horizon, and in turn that translated into a more substantial and more robust fiscal stabilisation package, those two things together in time would lead to the rating returning back to triple-A.
"But given the nature of the debate currently in the country and the polarization of views around fiscal policy we don't see anything immediately on the horizon that would make this the most likely scenario and upgrade back to triple-A again."
Chambers cited five other sovereigns that have lost their triple-A rating and later regained it, saying that the shortest period it took to regain the triple-A rating was nine years and the longest was 18 years.
But Beers stressed that S&P was not suggesting any particular timeline for the US triple-A rating to be reinstated. Canada, Sweden, Finland, Australia and Denmark were the five countries cited.
Chambers said: "Five have regained their triple-A rating and they all did it by undertaking, over a sustained period of time, a substantial fiscal consolidation programme and not only stabilised the debt as a share of the economy but markedly reduced the debt as a share of the economy. And all of them with the exception of Australia, also undertook profound economic reform that markedly improved their external position.
- Companies not in Support of the Idea of Workers on Boards
- BDO Reports 8.5% Increase in Revenue
- Company Bosses Jailed for Tax Fraud
- Treasury Launches Investigation into Barriers Restricting Women in Business
- The Chief of Denmark Based Bank Quits Over £178bn Money Laundering
- Boss of a Recruitment Agency Sentenced to Serve Jail Period of 27 Months
- Former Trump Lobbyist Found Guilty of Tax Evasion and Bank Fraud