Reducing the outlook for its economy to negative

Modi

Regarding the US economy, Moody’s notes that “continued political polarization” in Congress increases the risks

Moody’s lowered its credit rating stable to negative Expectations for the economy of the United States (US) due to high Impotence Taxes and declining affordability religion, according to a memo late Friday. Moody’s decision on the US economy comes after another rating agency, Fitch, The country’s rating will be downgraded this year after months of political tensions over the US debt ceiling.

Debt rating agency Moody’s noted in its statement that “continued political polarization” in the US Congress “increases the risk that lawmakers will not be able to reach consensus on a fiscal plan to halt the decline in debt sustainability.”

Investors are concerned about federal spending and political polarization, which contributed to a sell-off in U.S. government debt that pushed prices to their lowest levels in 16 years.

“It is difficult to disagree with this logic, because there is no reasonable expectation of fiscal consolidation in the near term,” he said publicly. Christopher Hodge, chief US economist at Natixis. “The deficit will remain large (…) and with interest costs consuming a larger portion of the budget, the debt burden will continue to grow.”

For this part, William FosterThis was confirmed by Moody’s First Vice President in statements to the agency Reuters “Any kind of meaningful political response that we could see to this decline in fiscal strength will likely not happen until 2025 because of the reality of next year’s political calendar,” he added.

Moody’s is the only one of the three major rating agencies to maintain the ‘A’ rating for the US economy, despite the current downgrade of the outlook to negative. Fitch lowered its credit rating in August to AA+, while Fitch lowered its credit rating in August to AA+. Standard & Poor’s It has maintained its rating of “AA+” since 2011.

Publication of the new Moody’s memo sparked immediate reaction from Joe Biden’s Democratic government. White House spokesman Karen Jean-PierreHe noted that the change was “another result of the extremism and dysfunction of Republicans in Congress.”

Meanwhile, Treasury Undersecretary Wally Adeyemo said in a statement that “although Moody’s statement maintains the US AAA rating, we disagree with the change to the negative outlook.” “The US economy remains strong, and Treasury securities are the world’s leading safe and liquid assets.”