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11 Jun 2013
Flash: S&P claims US has ‘matched its peers’ – Investec
FXstreet.com (New York) - In the United States, there were developments on the US sovereign debt rating overnight with S&P upgrading the credit outlook of the US to stable from negative.
It maintained its rating at AA+, having removed its AAA status in 2011 – S&P remarked that a number of the previously identified downside risks had diminished and that US economic performance stood to “match or exceed its peers’” over the next few years.
According to Lee McDarby, Corporate Treasury at Investec, “Even though this is clearly a step in the right direction, the market reaction to this news was fairly muted.” In the Eurozone, ECB President Draghi commented that its bond buying program would only be used to preserve the Euro not be used to save profligate countries from insolvency. “Although the comments came on the eve of hearings at Germany's top court to weigh the legality of so-called Outright Monetary Transactions (OMT) program, it remains to be seen if the ECB will be true to its word should any of the peripheral nations come under distress in the future.” McDarby adds.
It maintained its rating at AA+, having removed its AAA status in 2011 – S&P remarked that a number of the previously identified downside risks had diminished and that US economic performance stood to “match or exceed its peers’” over the next few years.
According to Lee McDarby, Corporate Treasury at Investec, “Even though this is clearly a step in the right direction, the market reaction to this news was fairly muted.” In the Eurozone, ECB President Draghi commented that its bond buying program would only be used to preserve the Euro not be used to save profligate countries from insolvency. “Although the comments came on the eve of hearings at Germany's top court to weigh the legality of so-called Outright Monetary Transactions (OMT) program, it remains to be seen if the ECB will be true to its word should any of the peripheral nations come under distress in the future.” McDarby adds.