The Sovereign debt defaults of the United States will lead to confusion in the global financial markets. The default has occurred due to the heavily borrowed foreign currencies and the mutation in the exchange rate. The interest rate on the debt has increased at excruciating levels.

The country can go back to recession levels with increase in interest rates, if the rating agencies do not reduce the US credit ratings.

A US financial analyst stated, "There's a perfect storm happening on a global macroeconomic basis with no debt deal here and the ongoing issues in Europe, and the market is looking at all these things and is fairly anxious".

On Thursday, Credit rating agency Standard and Poor's stated that there is a less risk of payment default, but if it happened then the results will affect the global economy. This year’s situation has so far been looking similar to the 2008 scenario, where investors lost their confidence and a flight to quality led to the temporary decline in the global funding markets.

David Mayes, former Chief Economist at the Reserve Bank, stated the US was not an insolvent and so the default has occurred due to the legal barrier in the ability to pay and so these barriers have to be removed soon to come out of the situation.