Fitch Comments on Super Committee Announcement

LONDON & NEW YORK--(BUSINESS WIRE)-- In Fitch's August 16 statement, when it affirmed the US 'AAA' sovereign ratings with a Stable Outlook, the agency commented that it would update its US economic and fiscal projections in light of the work of the 'Super Committee'. Fitch also commented that failure by the Super Committee to reach agreement would likely result in a negative rating action -- most likely a revision of the rating Outlook to Negative, which would indicate a greater than 50% chance of a downgrade over a two-year horizon. Less likely would be a one-notch downgrade.

The announcement today that the Super Committee was unable to reach agreement on at least USD1.2 trillion of deficit-reduction measures underscores the challenge of securing the political consensus on how to reduce the federal budget deficit and place US public finances on a sustainable path over the medium-term. Fitch now expects to conclude its review of the US sovereign rating by the end of November.

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Fitch RatingsDavid Riley, +44 20 3530 1175Group Managing DirectorFitch Ratings Limited30 North ColonnadeLondon, E14 5GNorSecondary AnalystJohn Olert, +1-212-908-0663Chief Credit OfficerorMedia Relations:Brian Bertsch, +1-212-908-0549 (New York)[email protected]Peter Fitzpatrick, +44 20 3530 1103 (London)[email protected]Mark Morley, +44 0203 530 1526 (London)[email protected]Daniel Noonan, +1-212-908-0706 (New York)[email protected]

Source: Fitch Ratings