S&P’s Schineller Publishes First U.S. Rating as Lead Analyst

Standard & Poor’s Lisa Schineller published her first credit-rating report on U.S. sovereign debt since assuming the role as lead analyst. It’s a position that became a lot higher profile after the U.S. lost its AAA ranking.

Schineller took over the primary-analyst position from Marie Cavanaugh, who retired in January, according to Washington-based S&P spokesman David Wargin. The company affirmed the U.S. rating today at AA+ with a stable outlook.

The lead U.S. analyst role went relatively unnoticed during the 60-years-running that S&P graded it AAA.

That changed in August 2011 when S&P downgraded the country for the first time, citing political wrangling and soaring deficits. The Treasury Department said S&P had made a $2 trillion error in its analysis, while S&P countered that there was no mistake and the discussion hinged on which baseline assumption should be used from the nonpartisan Congressional Budget Office.

Since then, record budget deficits have shrunk, economic growth accelerated, the dollar rallied, stocks climbed to all-time highs and Treasuries strengthened their hold as the world’s preferred haven from turmoil. Still, S&P said polarized policy-making and high government debt and budget deficits constrain the ratings.

Difficulties between the U.S. and S&P carried over after the downgrade, as the rating firm said that it was unfairly singled out in a $5 billion federal fraud lawsuit after the ranking cut. The U.S. has denied the allegation.

Latin America

Treasuries rallied after the U.S. downgrade, dropping from 2.56 percent the day of the ratings cut, to a record low of 1.379 percent in July 2012. The benchmark 10-year note yielded 2.59 percent at 3:42 p.m. in New York.

S&P changed the U.S. outlook to stable from negative in June 2013, Bloomberg data show.

Earlier in her career, Schineller was S&P’s primary analyst for Mexico and was secondary for Brazil’s rating at S&P, according to the New York-based company’s website.

Schineller, a director, was the lead analyst for Mexico when the country’s rating was increased to BBB+ in December.

She also worked in the International Finance Division at the Federal Reserve Board of Governors in Washington for more than three years before joining S&P in August 1999. Schineller received her Ph.D in economics from Yale University.

“Lisa has a wealth of experience as an economist and analyst both at S&P and at prior institutions including the Federal Reserve,” Curt Moulton, S&P’s global head of sovereign ratings in New York, said in a phone interview. “She’s also been an adjust professor at Columbia University. We’re very pleased to have such an experienced analyst following the U.S.”

Schineller wasn’t immediately available to comment.

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