Fitch: Implementation of US sequester would not prompt downgrade (Barcelona) - Fitch Ratings published a report on Wednesday on the fiscal outlook for the United States and commented on the rating implications of the country’s fiscal policy choices.

According to the document, allowing for the automatic spending cuts to come into effect would not result in a negative rating action for the US. Nevertheless, Fitch warns that “such an outcome would further erode confidence that timely agreement will be reached on additional deficit reduction measures necessary to secure the 'AAA' rating.”

The rating agency adds that “The suspension of the debt limit until 19 May 2013 has reduced the near-term pressure on the US 'AAA' rating. Fitch Ratings does not anticipate a repeat of the debt ceiling crisis of August 2011 but a failure to raise the debt ceiling in a timely fashion would prompt a review and likely downgrade of the US sovereign rating.”