Fitch Ratings warned that European nations could face credit rating downgrades if U.S.-Denmark tensions over Greenland weaken NATO. The agency flagged potential fractures in the alliance as a risk, particularly for countries near Russia.

The warning follows remarks by Danish Prime Minister Mette Frederiksen, who said disagreements with the U.S. over Greenland threaten NATO’s unity. Fitch’s James Longsdon noted that proximity to geopolitical flashpoints would influence any changes.

Longsdon emphasized that Denmark’s triple-A rating remains secure due to Greenland’s minimal fiscal impact. However, broader European ratings could shift if alliance cohesion weakens, reflecting heightened regional security concerns.

Analysts are monitoring U.S.-European relations closely. Any downgrade would signal deepening instability, affecting investor confidence and borrowing costs across the continent. Market watchers expect further clarity after upcoming diplomatic developments.