Moody’s lowered the U.S. credit rating outlook to “negative” due to concerns about political polarization affecting the ability to reach a fiscal plan.
The deficit has increased, and Republicans are working to avoid a shutdown.
The White House blames Republican extremism for the situation.
Moody’s statement said, “Continued political polarization within U.S. Congress raises the risk that successive governments will not be able to reach consensus on a fiscal plan to slow the decline in debt affordability.”
Adding, “In the context of higher interest rates, without effective fiscal policy measures to reduce government spending or increase revenues, Moody’s expects that the US’ fiscal deficits will remain very large, significantly weakening debt affordability.”
Deputy Treasury Secretary Wally Adeyemo addressed the downgrade in a statement, saying “While the statement by Moody’s maintains the United States’ AAA rating, we disagree with the shift to a negative outlook,”
“The American economy remains strong, and Treasury securities are the world’s preeminent safe and liquid asset,” promised the bureaucrat.
Biden’s press secretary blamed the GOP for the downgrade.
“Yet another consequence of congressional Republican extremism and dysfunction,” claimed Karin Jean-Pierre.
Despite the change in outlook, the U.S. maintains its AAA rating.
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