Fitch affirms 'AAA' rating on US

New York: Fitch on Tuesday confirmed its coveted 'AAA' sovereign rating on the US and maintained a stable outlook on the country's long-term prospects, less than two weeks after rival S&P downgraded the world's largest economy.

Underlining that America's "exceptional creditworthiness" remains intact, global rating agency Fitch affirmed its 'AAA' sovereign rating.

The latest move comes about 10 days after Standard and Poor's (S&P) stripped the US of its 'AAA' status, citing the nation's mounting debt as well as deficit.

S&P decision to downgrade US sovereign rating to 'AA+' had rattled the global financial markets, sending stocks into a tailspin.

"The affirmation of the US 'AAA' sovereign rating reflects the fact that the key pillars of US's exceptional creditworthiness remains intact: its pivotal role in the global financial system and the flexible, diversified and wealthy economy that provides its revenue base.

"Monetary and exchange rate flexibility further enhances the capacity of the economy to absorb and adjust to shocks," Fitch said in a statement.

It has also kept a stable outlook on the US long-term ratings.

Rating agency Moody's Investors Service had earlier this month retained 'AAA' rating on the US but with negative outlook.

According to Fitch, it would review fiscal projections as well as its near and medium-term economic outlook on the US, based on the outcome of the meeting of Joint Select Committee.

The panel is entrusted with the responsibility of bringing down budget deficit by as much as $1.5 trillion.

Fitch pointed out that the US sovereign liabilities, both dollar and Treasury securities, remain the global benchmark. The US credit profile benefits from unparalleled financing flexibility and enhanced debt tolerance, even relative to other large 'AAA'-rated sovereigns, it added.

"The US dollar's status as the pre-eminent global reserve currency and depth of the US Treasury market render financing risks minimal and underpin a low-cost of fiscal funding," the statement said.

However, Fitch noted that fiscal profile of US government has deteriorated sharply and overall level of general government debt is estimated to reach 94 per cent of GDP this year.