Talking to IRNA Dr Zafar Moeen Nasir Chief of Research at Pakistan Institute of Development Economics said that such development could also affect the economies of those countries which are based on US dollars.
US right now is facing a bitter deadlock over a deal to raise the debt ceiling which has already harmed the US economy.
Political parties of US, Republicans and Democrats, so far unable to reach a compromise, and are perusing rival budget plans, pushing the United States closer to a debt default.
The International Monetary Fund pressed polarized US politicians to raise the US debt ceiling ?expeditiously to avoid a severe shock to the US economy.
The IMF warned that US debt would total 99 per cent of the size of the US economy this year and 103.0 per cent in 2012.
"The deadlock between Republicans and Democrats could lead the country to bankruptcy," said Dr Zafar Moeen Nasir. He said that the issue is seriously damaging the US economy.
The economist said that dollar is becoming weak and many countries that have strong economies are changing towards other currencies.
"The credibility of American dollar is at stake," noted Dr Zafar Moeen Nasir.(*)
Editor: Jafar M Sidik
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