Moody's Downgrades U.S. Outlook Due to Rising Rates and Deficits

Moody's Investors Service has downgraded the ratings outlook on the United States' government from stable to negative, citing rising risks to the nation's fiscal strength and political polarization. The agency expects the US' fiscal deficits to remain large, significantly weakening debt affordability. The ongoing brinkmanship in Washington raises concerns that successive governments will struggle to reach consensus on a fiscal plan. However, Moody's maintains the US' Aaa rating, expecting the country to retain its exceptional economic strength. The move comes as Congress faces the threat of a government shutdown, with lawmakers at odds over a funding bill.