May 24 Reuters Ratings agency Fitch put the United States39; credit on watch for a possible downgrade on Wednesday, raising the stakes as talks over the country39;s debt ceiling go down to the wire, and adding to the jitters in global markets.

Fitch put the country39;s AAA rating, its highest rank, on a negative watch in a precursor to a possible downgrade should lawmakers fail to raise the amount that the Treasury can borrow before it runs out of money, which could happen as soon as next week.

A downgrade could affect the pricing of trillions of dollars of Treasury debt securities. Fitch39;s move revived memories of 2011, when SP downgraded the United States to AAplus and set off a cascade of other downgrades as well as a stock market sell off.

On Thursday, stocks in Asia fell as investors remained wary of risky assets due to the hit the global economy will take if the U.S. government defaults. Treasury bills maturing around June 1, the socalled Xdate when the government runs out of money, have been under pressure for weeks and came in for further selling, pushing yields on securities maturing on June 1 to 7.628.

It39;s not entirely unexpected given the shambles that is the debt ceiling negotiations, said Tony Sycamore, analyst at IG Markets in Sydney. This is not a great sign.

President Joe Biden39;s administration and congressional Republicans are at an impasse over raising the 31.4 trillion debt ceiling, and Fitch said its rating could be lowered if the U.S….