‘No risk’ to US losing credit rating

“No risk of that,” Mr Geithner said when asked if the United States would see a downgrade after Standard & Poor’s on Monday slapped a negative outlook on its Treasury debt rating.

“Again, if you listen carefully now, you see the leadership of the United States of America ... recognising now this is the right thing to do for the economy.”

Mr Geithner made the comments to voice disagreement with the S&P move and emphasise Washington was serious about putting in place mechanisms that would bring down deficits.

“Actually, I think things are better than they’ve been if you want to think about the prospects for improving our long-term fiscal position,” Mr Geithner said.

“If you’re looking very carefully at what’s happening in Washington you see people on both sides – Democrats and Republicans – agreeing with the president that we have to put in place some reforms now to bring down our long-term deficits,” he added.

Mr Geithner added that both domestic and foreign investors are still confident in US debt and the stronger growth prospects of the US economy.

He said that he believes it is possible for the Obama administration to secure a deal with Democrats and Republicans in Congress to reach a deal to “lock in” targets and mechanisms to cut deficits by $4trillion (£2.45trillion) over the next 10 to 12 years.