US credit rating decline likely, says risk analysis firm

Risk analysis company CheckRisk has today announced that it is raising the probability of the US losing its AAA rating to 70% for S&P and between 50% and 60% for Moody's and Fitch.

Nick Bullman, founder and managing director of CheckRisk, has said "the loss of the AAA rating status has the potential to be a major risk event for the US and the odds are increasing by the hour".

The loss of the AAA status could cost the US an additional $200bn (€138.3bn) in interest costs per annum over the medium term.

Coming as it does at a time of a fragile global economy, CheckRisk has decided to raise the probability of these events.

Mr Bullman added: "The risk of an outright default has risen to 10% from 0% and the fact that we are able to even consider an outright default in the world’s only perceived risk-free asset should send shudders through the band and equity market investors.

"We do not expect an outright default but are deeply concerned that politicians on both sides of the Atlantic appear to be making it up as they go along".