The post Moody’s downgrades US credit rating due to rising debt appeared on BitcoinEthereumNews.com.

Moody’s credit rating agency downgraded the credit rating of the United States government from Aaa to Aa1, citing the rising national debt as the primary driver behind the reduction in creditworthiness. According to the May 16 announcement from the rating agency, US lawmakers have failed to stem annual deficits or reduce spending over the years, leading to a growing national debt. The rating agency wrote: “We do not believe that material multi-year reductions in mandatory spending and deficits will result from the current fiscal proposals under consideration. Over the next decade, we expect larger deficits as entitlement spending rises while government revenue remains broadly flat.” The credit downgrade is only one degree out of the 21-notch rating scale used by the company to assess the credit health of an entity. An overview of the US national debt. Source: US National Debt Clock Despite the negative short to medium-term credit outlook, Moody’s maintained a positive outlook on the long-term health of the United States, citing its robust economy and the status of the US dollar as the global reserve currency as strengths, reflecting “balanced” lending risks. Related: Asia’s wealthy shifting from US dollar to crypto, gold, China: UBS Investors react to Moody’s US credit revision Moody’s announcement drew mixed reactions from investors and market participants, leaving many unconvinced by the agency’s revised outlook. Gabor Gurbacs, CEO and founder of crypto loyalty rewards company Pointsville, cited the rating agency’s previous credit assessments during times of financial stress as unreliable, signaling that the outlook was too optimistic. “This is the same Moody’s that gave Aaa ratings to sub-prime mortgage-backed securities that led to the 2007-2008 financial crisis,” the executive wrote in a May 17 X post. However, macroeconomic investor Jim Bianco argued that the recent Moody’s credit outlook does not reflect a real…

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Filed under: News - @ May 17, 2025 9:24 pm