On August 2, U.S. President Obama signed the bill to raise the debt ceiling and reduce the deficit. This effectively ended months of discussions regarding the U.S. debt ceiling and the risk of government default, with an agreement reached just prior to the critical deadline for bond maturities.
On the same day, the U.S. Senate passed the bill to raise the debt ceiling and reduce the deficit by a vote of 74 to 26. The day before, the House of Representatives had passed the bill with a vote of 269 to 161.
After the Senate vote, Obama stated, “This is the first step in ensuring that America as a nation ‘lives within its means.’ It also allows us to continue investing in areas such as education and research, to create new jobs and ensure we do not cut back excessively in a still fragile economy.” He urged Congress to take further steps to boost economic growth, create jobs, and enhance consumer confidence.
Moody's, one of the three major international rating agencies, confirmed the U.S. AAA rating, stating that the increase in the debt ceiling eliminated the risk of default and decided to maintain the highest level of sovereign credit rating for the United States – AAA.
Experts at Worldway Immigration believe that, referring to the historical precedent of other large economies' ratings being downgraded, even if the debt rating slightly decreases, it may not have a significant impact. In February 2001, Standard & Poor's downgraded Japan's credit rating from AAA to AA+, and at that time, many investors believed that Japanese government bond prices would plummet; however, the yield on Japanese bonds actually fell a week later.
