Moody's devalues US Credit Rating outlook to "Negative", Biden blames Republicans

Posted on November 24, 2023   |  

Moody's has shifted its perspective on the US government from 'stable' to 'negative,' expressing concerns about financial matters and the cooperation of lawmakers.

Despite maintaining the top AAA rating, Moody's is contemplating a potential downgrade due to ongoing worries.

The US is anticipated to continue facing significant budget shortfalls as interest rates rise, and government spending increases, especially on initiatives like social programs and infrastructure.

A major reason for this change is the increased cost of repaying debts for the US, influenced by higher interest rates.

The lack of unity among politicians is viewed as a risk to how the country handles its finances and tackles long-term debt challenges.

With substantial fiscal deficits contributing to decreased debt affordability, there is growing concern for agencies like Moody's.

The downgrade coincides with the possibility of a government shutdown and a looming debt ceiling crisis in the US.