The US Treasury Secretary, Scott Bessent, has strongly reacted to Moody's decision to downgrade the US credit rating from AAA to AA1. This news came out on Friday evening. Bessent stated in an interview with NBC that Moody's is behind the facts with this move. 'The deterioration is largely attributed to the previous administration,' says BNR's in-house economist Han de Jong.
According to De Jong, Bessent means that Moody's is lagging behind because the deteriorated state of US government finances is only now being acknowledged, while the situation has been precarious for longer. 'Bessent mainly blames the previous administration for the deterioration.'
De Jong also points to the broader picture of credit rating agencies worldwide. 'There are essentially three, maybe four major rating agencies. Moody's is one of them, along with S&P Global and Fitch.' S&P has not given the US the highest rating since 2011, 'and Fitch already downgraded the US rating in 2023.' According to De Jong, Moody's is thus following the other agencies with this step and is indeed somewhat behind.