"Fitch Ratings’ US credit rating downgrade should have little direct impact on financial markets," said Goldman Sachs (GS) early Wednesday morning in Asia.

GS cites the rating cut’s reflection on governance and medium-term fiscal challenges, as well as the lack of new fiscal information, to rule out the importance of the US rate cut news.

Also, the US banks signal the push to the US Treasury holders towards selling their assets on the rating change as the catalyst for expecting no major change due to the news.

Market reaction

US Dollar picks up bids to pare the previous retreat from the three-week high on the news, mildly bid near 102.10 by the press time.

Also read: Fitch downgrades US government’s AAA credit rating to AA+, US Dollar retreats