Moody's Downgrade Sparks Fiscal Fears in the U.S.

The recent downgrade of the U.S. sovereign credit rating by Moody's has intensified investor concerns about the country's growing $36 trillion debt. This downgrade, which follows Fitch and S&P, demands greater fiscal restraint from Washington amid potential increases in borrowing costs.

President Trump's tax-cut bill, beset by Republican disagreements, finally passed a key congressional committee, temporarily buoying markets. Yet, uncertainty over public finances remains, particularly as investors eye Congress's response.

With Treasury yields fluctuating, Moody's action refocuses attention on fiscal policy debates. As the White House dismisses concerns, emphasizing economic gains from tariffs, market analysts highlight the urgency for Washington to address spending and debt issues as fiscal deadlines loom.

(With inputs from agencies.)