Seven out of ten financial services practitioners consider the US remains attractive for investors, despite the country’s credit rating being downgraded for the first time, a Chartered Institute for Securities & Investment survey shows.
Leading credit ratings agency Standard & Poor’s cut the US standing by one notch in August, from AAA to AA+ with a negative outlook, over concerns about budget deficits.
However, some respondents to the online survey feel the downgrade will have a positive effect. One said it had “given the US the wake-up call that it needed which will result in more prudent financial decisions.”
“The downgrade has saved the US from itself and it is now a better investment than it has been since the start of the crisis,” argued the contributor.
Another supporter said: “The US is still the safest country for investors. It is the largest and most versatile economy, with strong laws for the protection of investors.”
Among the 30% of respondents who no longer consider the US a safe haven for investors, there were major concerns about the sustainability of its debt level.
“Even though the US has managed to avoid defaulting now, it will face the same, if not tougher, challenges in the future in trying to manage the debt and will have to make difficult but necessary spending cuts.”
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