By Matt Wirz
The U.S. lost its last triple-A credit rating.
Moody's Ratings downgraded the U.S. government on Friday, citing large fiscal deficits and rising interest costs.
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.
"Successive U.S. administrations and Congress have failed to agree on measures to reverse the trend of large annual fiscal deficits and growing interest costs," Moody's wrote in a statement. "We do not believe that material multi-year reductions in mandatory spending and deficits will result from current fiscal proposals under consideration."
Updates to follow as news develops.
(END) Dow Jones Newswires
May 16, 2025 16:59 ET (20:59 GMT)
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