The credit rating agency Moody’s Investors Service lowered its outlook on the U.S. government’s debt on Friday to “negative” from “stable,” citing the cost of rising interest rates and political polarization in Congress.
Moody’s retained its top triple-A credit rating on U.S. government debt, though it is the last of the three major credit rating agencies to do so. Fitch Ratings lowered its rating to AA+ from AAA in August, and Standard & Poor’s downgraded the U.S. in 2011. A reduced outlook, however, raises the risk that Moody’s could eventually strip its triple-A rating from the U.S. as well.
A lower rating on U.S. debt could cost taxpayers if it leads borrowers to demand higher interest rates on Treasury bills and notes. The yield on the 10-year Treasury has risen significantly since July, from about 3.9% to 4.6% Friday, an unusually sharp rise.
I see they’re still on the neoclassical bandwagon.
This is valid though: