An international credit rating agency has downgraded its assessment of the long-term outlook for government finances in the United States from stable to negative.
Standard & Poor's says the rating was based on a lack of clear plans from Washington to reduce the growing US deficit.
Democrats and the Republicans are locked in a battle over the extent of spending cuts.
The BBC reports the federal deficit currently stands at $US1.4 trillion and is expected to reach $US1.5 trillion in the current fiscal year.
The US has the top AAA credit rating on its long-term bonds.
The US Treasury says Standard & Poor's has underestimated the ability of America's leaders to address the fiscal challenges facing the US.
