Credit agency defends us ratings reduction

Credit rating agency Standard & Poor's has defended its decision to downgrade the US government's credit rating from AAA to AA+ with a negative outlook.

S&P officials insisted they had come to a reasoned conclusion, and said the agency had given plenty of warning that a downgrade would happen if Congress and President Obama's administration could not produce a "credible" deficit plan.

Global head of sovereign ratings at S&P David Beers said his agency was concerned the deal reached on the debt ceiling and budget last weekend fell short of what was needed.

He cited an ideal spending cut of $4trn (£2.4trn) over 10 years, rather than the agreed $2.1-2.4trn (£1.2trn-£1.4trn).

Source: Sky News