A Fitch Rankings financial agency sign on a constructing in Canary Wharf, London, on Thursday, March 1, 2012.
Matt Lloyd | Bloomberg | Getty Images
WASHINGTON — Rankings agency Fitch’s recent stern warning on U.S. debt added recent urgency to ongoing debt ceiling negotiations between the White House and Congressional Republicans on Thursday.
Fitch Rankings, considered one of the highest three rating agencies, announced late Wednesday that it had given the US triple-A standing within the “negative watchdog” category.
“The debt ceiling advantage, the failure of the US authorities to meaningfully meet the medium-term fiscal challenges that may result in a widening budget deficit and the rising debt signal a risk to the US creditworthiness,” Fitch said in an announcement on the choice.
The agency also strongly suggested that if Congress fails to succeed in an agreement by the June 1 deadline set by the Treasury Department to lift or suspend the debt limit, Fitch will downgrade America’s credit standing.
Such a failure “can be a negative sign of broader governance and the US’ willingness to fulfill its obligations in a timely manner, which Fitch believes can be unlikely to be consistent with an ‘AAA’ rating.”
The warning got here just hours after House Speaker Kevin McCarthy tried to calm jittery financial markets.
“I would not scare the markets in any shape or form,” the California Republican told Fox Business Wednesday. “We’ll come to an agreement… and there ought to be no worries.”
On Thursday, negotiators appeared to have made little noticeable progress in greater than every week of near-around-the-clock talks.
Added to concerns in regards to the timing was the House leadership’s decision to send members home for every week’s break, albeit with instructions to be able to return to Washington if their votes were needed to pass a compromise bill resulting from an agreement reached by President Joe Biden and McCarthy’ ego.
“I do not know if we’ve got a deal today,” McCarthy said Thursday morning as he entered the Capitol.
“We have already spoken with the White House today, we’ll proceed to work,” he said as he left after the day’s only round of voting. “They’re working on the numbers, we’re working on the numbers and we’ll work together.”
One influential Republican said he was optimistic about reaching a deal before the vacation weekend. Representative Kevin Hern of Oklahoma, who chairs the 156-member Republican Study Committee, said Thursday he believed a deal may very well be reached by Friday afternoon.
“We’re getting near an agreement. I believe these are among the higher points they’re working on immediately,” Hern told Reuters. “You’ll likely see the deal by tomorrow afternoon.”
Meanwhile, Democrats have turn into increasingly critical this week of the White House’s decision to not release details of the talks frequently. It is a tactic that stands in stark contrast to McCarthy’s full-fledged judicial press, which spoke to reporters in regards to the talks several times a day and appeared on television almost day by day.
The White House tried to fend off the criticism this week by arguing that Biden had been talking in regards to the debt ceiling for months.
“We have been very clear over the past five months,” White House spokeswoman Karine Jean-Pierre said earlier this week. “I would not just have a look at the previous few days. The last five months, consistently, you’ve got heard from this president.”
That is an evolving story. Check for updates.