According to TechFlow, credit rating agency Moody's has downgraded the U.S. government's credit rating from the highest level Aaa to Aa1, mainly due to the rising national debt. In its announcement on May 16, Moody's pointed out that U.S. lawmakers have failed to curb annual deficits or reduce spending, resulting in continued growth in the national debt. Moody's said: "We believe that the fiscal proposals currently under consideration will not bring about a substantial multi-year reduction in mandatory spending and deficits. Over the next decade, we expect the deficit to widen as welfare spending increases while government revenue remains largely unchanged."
Despite the negative short- to medium-term credit outlook, Moody's maintained a positive outlook on the long-term economic health of the United States, citing its strong economy and the dollar's status as the global reserve currency as advantages that reflect balanced lending risks.