By Pam Martens and Russ Martens: August 3, 2023 ~
At 5:13 p.m. ET on Tuesday, after the stock market closed, Fitch downgraded the U.S. credit rating from AAA to AA+. Fitch is now the second of the three major credit rating agencies to have taken the historic step of removing the triple-A rating from the U.S. S&P made its first-ever downgrade to the U.S. credit rating on August 5, 2011, also from AAA to AA+, and has kept it there ever since. Moody’s is now the only member of the Big Three credit rating agencies that has maintained a triple-A rating on the U.S.
As the chart above indicates, the stock market responded negatively to this development yesterday, particularly over the fact that it came at a time when the U.S. Treasury is boosting the amount of debt it is issuing.
Yesterday, the U.S. Treasury announced its plans to increase its debt issuance, writing as follows: