WASHINGTON (AP) — The Fitch credit rating agency has warned thatit is reviewing the U.S. government's AAA credit rating for apossible downgrade, citing the impasse in Washington that hasraised the threat of a default on the nation's debt.

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Fitch placed the U.S. credit rating on negative watch Tuesday, astep that would precede an actual downgrade. The agency said itexpects to conclude its review within six months.

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The announcement comes as House and Senate leaders face aThursday deadline to raise the nation's $16.7 trillion borrowinglimit. Fitch says it expects the debt limit to be raised soon. Butit adds, "the political brinkmanship and reduced financingflexibility could increase the risk of a U.S. default."

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A Treasury Department spokesman said the announcement "reflectsthe urgency with which Congress should act to remove the threat ofdefault hanging over the economy."

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Fitch is one of the three leading U.S. credit ratings agencies,along with Standard & Poor's and Moody's Investors Service.S&P downgraded U.S. long-term debt to "AA+" in August 2011.

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Fitch said that the Treasury might not be able to prioritize itsinterest payments on U.S. debt to avoid a default. "It is unclearwhether it even has the legal authority to do so," Fitch said.

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Many economists expect Treasury to prioritize its payments tostave off default. And Moody's Investors Service said in an Oct. 7report that Treasury would continue to make interest payments afterthe Thursday deadline.

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A credit rating is an assessment of how able a country orcompany is to repay the money it's borrowed. A AAA rating letscompanies and governments borrow at super-low rates.

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So far, most investors have remained confident in U.S. debt.Rates have risen on short-term Treasurys but not on longer-termdebt, like the benchmark 10-year Treasury note. That shows thatinvestors are continuing to buy that debt. The rate on the 10-yearnote is important because it affects rates on mortgages and manyother loans.

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After S&P downgraded long-term U.S. credit two years ago,investors sold stocks but continued to buy longer-term U.S.Treasurys.

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Despite uncertainty over whether the government will maintainits authority to borrow, investors have continued to pour moneyinto long-term Treasurys. The yield on the 10-year note hasremained stable at slightly above 2.7 percent, a sign thatinvestors still believe the U.S. government will repay itslonger-term debt.

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The U.S. government has never intentionally failed to pay itsdebts. That's why investors consider Treasurys the safest and mostliquid investments in times of uncertainty. Treasurys are alsodenominated in dollars, the main currency used by central banks andfinancial institutions around the world.

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Lawmakers spent most of Tuesday trying to reach an agreement togive Treasury authority to borrow and avoid an eventualdefault.

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House Republicans pushed for passage of legislation late Tuesdaythat would allow the Treasury to borrow normally until earlyFebruary and end a 15-day partial government shutdown at leastuntil Dec. 15.

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While the House readied for a possible Tuesday night vote, theimmediate result was to impose a daylong freeze on Senatenegotiations on a bipartisan compromise.

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