Moody's Shakes Markets with US Credit Downgrade
Moody's has downgraded the U.S. sovereign credit rating, citing concerns over the nation's soaring $36 trillion debt. This unexpected move could affect President Trump's tax cut plans and global markets. The agency pointed to unaddressed fiscal deficits and rising interest payments as contributing factors, sparking widespread criticism.
In a dramatic turn of events, Moody's Investors Service downgraded the United States' sovereign credit rating on Friday. The surprising move, rooted in concerns about the country's mounting debt reaching $36 trillion, raises complexities for President Trump's tax reform ambitions and could stir global market reactions.
Moody's, the last major agency to hold the U.S. at its top triple-A rating, reduced it to Aa1, highlighting unresolved fiscal deficits and inflated interest obligations. Economists and political figures expressed strong opinions, with Trump's former advisor Stephen Moore labeling the downgrade as "outrageous."
The development comes amid President Trump's agenda to balance the budget, a task compounded by failed cuts in government spending and contentious trade tariffs. With a downgraded rating, investors are cautious as long-term treasury yields climb, pointing to heightened sensitivity in financial markets.
(With inputs from agencies.)
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