Downgraded

Despite the debt ceiling deal reached in the US this week after an fractious fight, a Chinese credit ratings agency has decided to downgrade the United States' sovereign debt as an investment.

CNN reports that the Dagong Global Credit Rating Co. has lowered its rating of US treasuries from A+ to A, saying the political fight in America cast serious doubt on the United States' debt as an investment. China is the largest single holder of US debt, and has watched the fight in Washington closely.

"The squabbling between the two political parties on raising the U.S. debt ceiling reflected an irreversible trend on the United States' declining ability to repay its debts," Dagong Chairman Guan Jianzhong told CNN.

The Chinese central bank, meanwhile, welcomed the debt ceiling deal in America, but had cautionary words for US policy makers. The governor of the People's Bank of China warned that this country will continue to look for other places to invest its massive foreign currency reserves. Governor Zhou Xiaochuan said in a statement on the bank's website that the United States must safeguard against further risk for the good of the global economy.

"China hopes the U.S. Administration and the Congress would take responsible policy measures to handle its debt issue in light with the interests of the whole world including those of the United States," said Zhou.