Moody’s downgrades the U.S. government, citing large fiscal deficits and rising interest costs
By Matt Wirz, The Wall Street Journal, May 16, 2025
Key Points
Moody’s downgraded the U.S. credit rating to Aa1 due to large deficits and rising interest costs.
Runaway budget deficits mean U.S. government borrowing will balloon at an accelerating rate, Moody’s said.
*The move strips the U.S. of its last remaining triple-A credit rating from a major ratings firm.
Runaway budget deficits mean U.S. government borrowing will balloon at an accelerating rate, pushing interest rates up over the long term, Moody’s said. The firm said in a March report that fiscal weakness looked set to continue even under analysts’ best-case scenarios.
The move strips the U.S. of its last remaining triple-A credit rating from a major ratings firm, following similar cuts by Fitch Ratings in 2023 and S&P Global Ratings in 2011. Moody’s downgraded the U.S. to Aa1, a rating also held by Austria and Finland…[end quote]
- -
| 