What does Moody mean lowering the US credit rating?

On Friday, Moody’s ratings announced the discount of the US government’s credit rating, announced a notch’s discount as a result of concerns due to the larger market for the largest debt of the rating agency.

Credit ratings are used by analysts to determine the loan abilities of the debt provided by a government or a corporation. Higher credit ratings in or near the upper part of the rating scale are considered a higher risk of magnitude than the lower end of the scale.

When rating agencies lower the credit rating of a country or company, the debt can serve as a signal that is risky, which can result in higher interest rates to compensate the additional risk. In the state of federal government, it means more expenses on interest expenses National debt.

The firm reflects the discount “increase in growth for more than a decade public debt and percentage rates to levels that are significantly higher than the same extent appreciated sovereignty. “

“A series of US controls and congress did not agree on measures to return the great annual trend Financial shortage And the growing interest expenses, “the company was explained.” We do not believe that the existing financial proposals will result as a result of mandatory spending and cutenesss, makeup and shortcomings. “

Moody’s reduces the US credit rating on increased debt

AAA from AAA to AAA AAA’s landing of Moody to AA1 to AA1 is announced on the 21st deductible scale. Productivity in Benchmark during a trading session on Monday 10 years of treasure bond approximately 4.45% went to the summit at 4.56% before decreasing. This month was 4.3%, above 4.5%, in March and April, above 4.5% before the rise.

10 years are used as a criterion for mortgage loans and corporate bond products, including other interest rates.

Treasury Secretary Bessent rejected Moody’s US loan as ‘lagging indicator’

In March, Moody’s warned that the national debt growth was unstable and raised the United States A discount risk. He writes that “even a very positive and low probability economic and financial scenario is also relatively weaker for other AAA evaluated and highly valued sovereigns.”

The company’s interest payments on debt is projected to increase from 9% to 30% of the federal income in 2035. The US Treasury Market and the US dollar as World Reserve Currency, “It reduced the prospects for expanding the financial shortcomings and reducing the debt.”

The discount by Moody’s is one-third of the three main rating agency US credit rating to cut the highest level.

The US government is deteriorating financial capacity, warns Moody’s

In August 2023, Fitch Ratings reduced a notch from the highest rating of AAA, and referred to the “management erosion” of the recurrent bill on the federal debt limit.

Fitch said that there are fiscal problems that expand and expand the expanding fiscal problems as it expands and grows a large national debt Spend in Social Security and Medicarehelped the action. This did not decline in the late 2023 and early 2024 in early 2024, the United States economy was in recession.

The first debt of US was the first in 2011 Affected in Congress During the dispute to reduce costs and debt limit, the standard and poor (S & P) cut the credit rating from AAA to AA + from “AA + from” AA + from “AAA”.

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The S & S & SP, “Long-term dispute to discuss the discussion of the legal debt and associated financial policy,” the long-term dispute will limit the growth of the Congress or stabilize the federal government’s debt burden.