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Hardy: Don't worry about Fitch's US ratings review
Fitch has put the US government's "AAA" credit rating on 'rating watch negative'.
The rating agency wrote in a statement: "Although Fitch continues to believe that the debt ceiling will be raised soon, the political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default."
But Saxo Bank's John Hardy says investors needn't worry too much about this. He says: "In theory, this could have implications for large portfolios if they have a mandate to only hold the AAA rated debt. But in practical terms, it doesn't mean a lot".
On the other hand, the US debt ceiling deadline is just around the corner, and this is putting pressure on the dollar.
John says the market is "playing with the idea we are going to get a deal". But he warns that because every deal will be temporary, it's not "great" for the dollar, as it means tapering will be delayed.
He does think, however, that the dollar will rally "once a deal is struck".
01:37 minutes
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