Standard and Poors rating agency affirmed that the US sovereign ratings remain ‘AA+/A-1+’ and the outlook remains stable. The affirmation comes out in the midst of a banking crisis with the US having three bank failures in a week. SVB was the largest failure since Washington Mutual’s September 2008 collapse and the second largest in U.S. history. The S&P says sovereign stability is based on strong American institutions, a diversified and resilient economy, extensive monetary policy flexibility.
The agency added that the sovereign rating on US is also based on the nations unique status as the issuer of the world’s leading reserve currency. The S&P concluded that the stable outlook on US indicates view that negative and positive rating factors for the US will be balanced over the next three years
In what many may call wishful thinking the S&P also expects US’s institutional checks, balances, strong rule of law, free flow of information to contribute to stability in economic policies
Source: Reuters. S&P
From The TradersCommunity News Desk