Treasury Secretary Janet Yellen testifies before the House Financial Services Committee on the state of the international financial system, in the Rayburn House Office Building on Capitol Hill in Washington, DC on June 13, 2023.
Mandel Ngan | Afp | Getty Images
WASHINGTON — Treasury Secretary Janet Yellen on Wednesday denounced Fitch’s decision to downgrade the United States’ longstanding credit rating that caused stocks to tumble.
Yellen, who spoke during a visit with Danny Werfel, commissioner of the IRS, called the move “surprising” considering the nation’s strong economic recovery from the Covid pandemic.
Fitch cited “expected fiscal deterioration over the next three years,” and “repeated debt-limit political standoffs” when it downgraded the nation’s rating to AA+ from AAA.
“I strongly disagree with Fitch’s decision, and I believe it is entirely unwarranted,” Yellen said. “Its flawed assessment is based on outdated data and fails to reflect improvements across a range of indicators, including those related to governance, that we’ve seen over the past two and a half years.”
Yellen touted recent robust U.S. economic numbers, with over 13 million new jobs since January 2021, a near-historically low 3.6% unemployment rate and a monthly decline in overall annual inflation for the last year.
CNBC has reached out to Fitch for comment on Yellen’s remarks.
“At the end of the day, Fitch’s decision does not change what all of us already know: that Treasury securities remain the world’s preeminent safe and liquid asset, and that the American economy is fundamentally strong,” Yellen added.