Senate panel to probe US downgrade by S and P

The US administration has already taken up cudgels against S&P for unleashing mayhem on the world's largest economy by its downgrade action.

Stung by the development, the US Senate's Banking Committee has begun collecting information about the downgrade action informally, but is yet announce an official probe, ABC News reported.

The report quoted an unnamed aide of the committee as saying that it was looking into the issue and gathering more information.

S&P on Friday announced a downgrade of its long-term sovereign rating for the US from the top-notch 'AAA' level to 'AA+' in the first-ever lowering of America's rating.

The downgrade has added to the woes of the US economy, which is already battling fears of slipping into another recession amid mounting debt worries.

The development has triggered mayhem in already weak stock markets in the US and abroad and stocks have dropped to their lowest levels in about two years.

President Barack Obama yesterday strongly defended the US credit profile and said America will always be an AAA nation, as its economic problems were "imminently solvable".

Speaking for the first time since the downgrade, Obama said he would present his own proposals for overcoming the debt woes in the "coming weeks" and asked the Republicans to accept tax hikes on the most affluent Americans.

"No matter what some agency may say, we have always been and always will be a triple A country," Obama said, arguing that global investors still saw the US economy as one of the safest investment destinations in the world.

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