Flash: Ratings downgrade – BAML

FXstreet.com (London) - Research teams at Bank of America Merrill Lynch look at the rating scenarios with regards to the US debt ceiling not being raised in time.

Key Quotes:

“If the debt ceiling is raised in time to avoid default, our strategists believe Moody’s and S&P will likely maintain their current ratings on Treasury debt of AAA and AA+, respectively”.

“However, if the debate remains contentious until the deadline approaches, Fitch might downgrade to AA+”.

“If the ceiling is not raised in time, all three ratings agencies are likely to downgrade Treasury debt”.