The ratings agency Fitch says that if the government shutdown lasts until March, it could lead to a cut in the country’s credit rating. Analysts are worried about the government’s ability to pass a budget and pay the bills it’s already racked up.
As Congress and the White House spar over funding for a border wall, there could be another fiscal crisis looming. Congress will also need to come to a deal to raise the debt ceiling, the cap on the government’s ability to borrow money. Fitch’s global head of sovereign ratings, James McCormack, told CNBC that the U.S. government is undergoing what he called “meaningful fiscal deterioration.”
“The interest burden in the U.S. government moving decidedly higher over the next decade. So there needs to be some kind of fiscal adjustment to offset that or the deficit itself moves higher and you’re essentially borrowing money to pay interest on the debt.”
With the political turmoil, the credit rating agency is worried about the government’s financial trustworthiness.