U.S. debt talks no breakthrough despite mounting pressure

13:54, July 15, 2011      

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U.S. President Barack Obama hosted the debt talks with top congressional leaders for the fifth consecutive day amid mounting pressure both at home and abroad, but the lingering negotiation did not make any breakthrough.

Dagong Global Credit Rating Co., Ltd., a rating agency from China, the largest foreign holder of U.S. government debt, cautioned Thursday that it is putting the credit rating of the United States on negative watch for a possible downgrade, trailing a similar move from Moody's Investors Service on Wednesday.

The International Monetary Fund (IMF) on Thursday also urged the United States to raise the debt ceiling and improve its fiscal sustainability over the long run, the latest such warning from the global lender.

"In the United States, current debt dynamics with unchanged policies are unsustainable. The imperative at the current conjuncture is to raise the debt ceiling," said the Washington-based IMF.

The borrowing limit, currently at 14.29 trillion U.S. dollars, was reached on May 16. The U.S. Treasury Department warned the world's largest economy would default without an agreement to lift the limit by Aug. 2.

Congress leaders and President Obama have no alternative but to ensure that the nation "upholds the full faith and credit of the country" and will not default on our obligations, White House Spokesman Jay Carney told reporters on Thursday.

Carney said progress has been made in the negotiation process, adding that President Obama aimed at striking a massive debt reduction deal of possibly saving 1.7 trillion U.S. dollars or more in one decade.

"I think that at a certain point the American people run out of patience," Obama said Thursday in an interview with a local U.S. media, adding that they might think policymakers are playing games and are not serious about solving problems.

Obama is demanding budget negotiators find common ground in a timely manner to ease market jitters, and he is scheduled to hold a press conference on the debt talks Friday.

Source: Xinhua
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