Rating agency Moody’s downgraded the US rating outlook from stable to negative amid a potential suspension of the federal government (shutdown).
“In a higher interest rate environment, without effective fiscal policy action to reduce government spending or increase revenue, Moody’s expects the U.S. budget deficit to remain very large, significantly weakening the debt burden,” the agency said in a statement.
It also noted that the decision was made due to Washington’s policies of what it describes as “brinkmanship” as well as “ongoing political polarization within the US Congress” that could pose difficulties in passing the budget plan.
On November 17, a compromise bill to continue funding the federal government, previously passed by the US Congress and signed by the US President, expires Joe Biden. If by this time the legislative and executive branches of the US government do not adopt a new similar document, then ministries and departments will be forced to suspend work due to lack of funding.
#Moodys #downgrades #rating #outlook #negative #EADaily
2023-11-11 00:15:00
