BEIJING, China - June 10, 2011 - A Chinese ratings house has accused the United States of defaulting on its massive debt, state media said Friday, a day after Beijing urged Washington to put its fiscal house in order.

"In our opinion, the United States has already been defaulting," said Guan Jianzhong, president of Dagong Global Credit Rating Co. Ltd., the only Chinese agency that gives sovereign ratings, according to the Global Times.

Washington has already defaulted on its loans by allowing the dollar to weaken against other currencies, thereby eroding the wealth of creditors, including China, Guan said.

The U.S. government will run out of room to spend more on August 2 unless Congress bumps up the borrowing limit beyond $14.29 trillion - but Republicans are refusing to support such a move until a deficit cutting deal is reached.

Ratings agency Fitch on Wednesday joined Moody's and Standard & Poor's to warn that the United States could lose its first-class credit rating if it fails to raise its debt ceiling to avoid defaulting on loans.

A downgrade could sharply raise U.S. borrowing costs, worsening the country's already dire fiscal position, and send shock waves through the financial world, which has long considered U.S. debt a benchmark among safe-haven investments.