US Treasury Secretary Timothy Geithner said he is not sure whether the bitterly fought debt agreement to be considered by the US Senate will avoid a downgrade of the U.S. top-tier credit rating.
Geithner, in an interview with ABC News aired Tuesday, also said he thought the risk of the US economy slipping into a double-dip recession was low, but added that the battle over the debt limit and the threat of default had damaged confidence in the economy.
I don't think that that risk right now is very significant, he said of a double-dip recession, in the interview which was recorded on Monday afternoon.
Geithner said the ratings agencies were going to take a careful look at whether Washington politicians have the will to act to bring deficits under control.
It's not my judgement to make whether the deal is enough to avoid a downgrade, saying that was up to the ratings agencies.
You know this is in some ways a judgment on the capacity of Congress to act. And what this deal does is put us in a much better position to make those tough choices because the down payment is pretty strong and this special committee, this mechanism for the reforms is a much more powerful device than we've had in the past.
Asked by interviewer George Stephanopoulos whether Congress' gridlock over the debt limit made a downgrade more likely, Geithner said, I don't know. It's hard to tell.
I think this is a good result but a terrible process. And ... I think as the world watched Congress step up to the edge of the abyss, it made them really wonder whether this place can work. But this is a good deal. It's a good agreement, he said