June 11, 2011 (World News Trust) -- The German credit rating agency Feri lowered its rating on U.S. sovereign debt from AAA to AA. It is the first Western rating agency to downgrade U.S. debt.
"Feri analysts justify the downgrade by the continuing deterioration of the creditworthiness of the country due to high public debt, inadequate fiscal measures, and weaker growth prospects," Feri said in a press release Wednesday.
“The U.S. government has fought the effects of the financial market crisis primarily by an increase in government debt. We do not see that there is sufficient attention being paid to other measures, “said Dr. Tobias Schmidt, CEO of Feri Rating & Research AG. “Our rating system shows a deterioration in economic health, so the downgrading of the credit ratings of U.S. is warranted.”
For the third consecutive year the deficit of the United States is in double digit percentages relative to gross domestic product (GDP), Feri said. “Deficits of such magnitude are not a sustainable fiscal policy. We would reconsider the rating when the U.S. government creates a long-term sustainable budget,” said Schmidt.
