Moody's Warns of Continued U.S. Fiscal Decline Amid Persistent Deficits and Policy Risks

The agency reaffirms the U.S. triple-A credit rating but highlights mounting challenges from rising debt, tariffs, and economic uncertainty.

Moody's has reaffirmed the U.S.' triple-A credit rating but warns of a multi-year decline in fiscal strength due to widening budget deficits and declining debt affordability.
The report underscores that higher interest rates have made U.S. debt less affordable, increasing reliance on the dollar and Treasury market to maintain creditworthiness.
Sustained high tariffs, unfunded tax cuts, and significant economic risks are cited as key factors diminishing the U.S.' ability to offset fiscal vulnerabilities.
President Trump's recent tariff policies have heightened market concerns, with fears of increased inflation and a potential economic slowdown.
Trump suggested he may offer tariff exemptions to some countries ahead of the April 2 deadline for implementing 'reciprocal tariffs' on trading partners.