MCLEAN, Virginia U.S. Treasury Secretary Janet Yellen on Wednesday voiced more objections to Fitch Ratings' downgrade of the main U.S. credit rating, calling it "entirely unwarranted" because it ignored improvements in governance metrics during the Biden administration and the country's economic strength.

In remarks prepared for delivery at an Internal Revenue Service contractor office near Washington, Yellen said the rating agency's announcement on Tuesday failed to take into account a resilient U.S. economy, with low unemployment, falling inflation, continued growth and strong innovation.

"Fitch's decision is puzzling in light of the economic strength we see in the United States," Yellen said. "I strongly disagree with Fitch's decision, and I believe it is entirely unwarranted."

She said Fitch's "flawed assessment" is based on outdated data and fails to reflect improvements in U.S. governance indicators over the past two and a half years of President Joe Biden's administration.

Fitch had cited a deterioration in U.S. governance that started during the prior Trump administration in making its decision, according to U.S. Treasury officials.

Richard Francis, a senior director at Fitch, told Reuters that the deterioration was partly reflected in the Jan. 6, 2021 insurrection at the U.S. Capitol building as former President Donald Trump sought to overturn the 2020 election results.

But Francis said the deterioration also was reflected in this year's debt ceiling fight, and the increasing polarization of both major political parties, making compromise harder to achieve.

In its decision to cut the U.S. rating by one notch to AA+ from AAA, Fitch also cited a fiscal deterioration over the next three years that will increase deficits and repeated down-to-the wire debt ceiling negotiations that threaten the U.S. government's ability to pay its bills.

But Yellen said that fiscal responsibility was a priority for her and Biden, and the June debt limit deal he reached with Republicans included more than $1 trillion in deficit reduction over 10 years.

Biden's proposed 2024 budget, which includes substantial tax hikes on wealthy individuals and corporations, would also reduce deficits by $2.6 trillion over the next 10 years.

Yellen said investments to modernize the IRS and improve tax enforcement, funded by $60 billion in new resources provided by last year's Inflation Reduction Act, would cut deficits by "hundreds of billions of dollars" over a decade.

She visited the IRS processing contractor facility in McLean, Virginia to highlight a pledge to allow taxpayers to submit all documents and correspondence digitally during the 2024 tax season, which would eliminate the manual processing of up to 125 million documents annually.

(Reporting by David Lawder; Editing by Paul Simao)