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3/26, 9:37 PM (Source: TeleTrader)
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Fitch sees US economy shrinking by around 3% in 2020

Fitch sees the United States GDP as "shrinking by around 3%" in 2020, the agency said in a press release on Thursday, noting that it leaves room for further revision depending on the efficacy of actions taken to mitigate the effects of the COVID-19 pandemic.

"In the event of the virus being contained during 2H20, Fitch assumes that real GDP growth will recover strongly in 2021, reflecting a sharp bounce-back," the agency stressed.

Fitch affirmed US credit rating at 'AAA' but pointed to the risk of near-term negative rating due to the "magnitude of the shock to the economy and public finances" posed by the coronavirus pandemic.

Although it considers United States' debt tolerance "to be higher than that of other 'AAA' sovereigns," Fitch sees "high fiscal deficit and debt" as "eroding" the US credit strength, the agency underlined.

Breaking the News / GG