U.s. Debt, Debt Limit | featured news

Standard & Poor's president Deven Sharma steps down just weeks after the agency downgraded the US credit rating.

Fitch Ratings said Tuesday it will keep its rating on U.S. debt at the highest grade, AAA, and issued a "stable" outlook, meaning it expects the rating to stay there.

Standard and Poor's does not think the United States will default on its debt, the rating agency's president Deven Sharma said on Wednesday.

Could the U.S. lose its top credit rating even if a deal is reached to raise the debt limit? Market analysts and investors increasingly say yes. The outcome won't be quite as scary as a default, but financial markets would still take a blow. Mortgage rates could rise. States and cities, already strapped, could find it more difficult to borrow. Stocks could lose their gains for the year.

Talks to reach a more ambitious deficit-reduction deal effectively broke down on Saturday, House Speaker John Boehner said, as he and fellow Republicans resisted any White House attempts that could increase taxes.

Democratic leaders called on Wednesday for new spending and tax cuts to boost the sluggish U.S. economy, setting up a fresh hurdle for bipartisan efforts to head off a government debt default this summer.