A downgrade could occur if Congress fails to raise the $31.4 trillion debt limit, which could lead to economic calamity and panic in global markets.

The news revived memories of a 2011 downgrade by Standard & Poor's and caused global stock markets to fall.

Although Fitch expects a resolution to the debt limit issue, they emphasized that failing to raise or suspend the debt limit could lead to missed payments and damage the US's creditworthiness.

The White House and Congress are at an impasse, and the IMF's head expressed hope for a resolution.

Fitch also commented on the US's growing budget deficit, which is expected to reach 6.5% and 6.9% of the total economy in 2023 and 2024, respectively.

S&P Global's credit rating is "AA-plus," which is the second highest rating.

In 2011, S&P downgraded the US's credit rating after a debt ceiling showdown in Washington.

Moody's has stated that it expects the US government to continue paying its debts on time, but public statements from lawmakers during the debt ceiling negotiations could change its assessments.