As largely expected by the securitization market, Standard & Poor's said today that it has lowered its long-term sovereign credit rating on the U.S. to 'AA+' from 'AAA'.

S&P also said that the outlook on the long-term rating is negative. At the same time, the rating agency affirmed its 'A-1+' short-term rating on the U.S. and removed both ratings from CreditWatch, where they were placed on July 14, with negative implications.The rating agency lowered its long-term rating on the U.S. because it thinks that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate showed that further near-term progress limiting the growth in public spending, specifically on entitlements, or on reaching an agreement on raising revenues is less probable than it had assumed previously and will stay a contentious and fitful process.

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