Fitch downgrades US debt on debt ceiling drama and Jan. 6 insurrection

Fitch Ratings downgraded its US debt rating on Tuesday from the highest AAA rating to AA+, citing “a steady deterioration in standards of governance.”

The downgrade comes after lawmakers negotiated up until the last minute on a debt ceiling deal earlier this year, risking the nation’s first default. But the January 6 insurrection was also a major contributing factor.

In a meeting with Biden administration officials, representatives from Fitch Ratings repeatedly highlighted the January 6th insurrection as a significant concern as it relates to US governance, a person familiar with the matter told CNN. The credit agency did not mention the insurrection in their full report on the downgrade.

Fitch did not immediately respond to CNN’s request for comment.

US debt has long been considered the safest of safe havens, but Tuesday’s rating cut suggests it has lost some of its luster. The downgrade has potential reverberations on everything from the mortgage rates Americans pay on their homes to contracts carried out all across the world.