S&P Affirms High US Sovereign Ratings

International rating agency Standard & Poor’s Global Ratings affirmed the US’ high “AA+” long-term and “A-1+” short-term sovereign ratings and maintained its “stable” outlook on the long-term rating.

“A diversified and resilient economy with stable growth, flexible monetary policy, and the advantages associated with the unique status of being the issuer of the world’s major reserve currency were factors in the reaffirmation of the United States’ high sovereign rating,” S&P analysts said.

However, among the negative factors hurting US economic performance, the rating agency cited “a sovereign debt burden approaching 100% of GDP and sharp controversies that block constructive cooperation between the Democratic and Republican parties.”

According to analysts at S&P Global Ratings, US real GDP will grow by 2.5% again in 2024, and over the three-year period (2025-2027), US economic growth should be 1.5% (2025), 1.7% (2026), and 1.9% (2027). The US unemployment rate is not expected to exceed 3.9% of the active population in 2024, rising to 4.2% in the next two years and falling to 3.9% in 2027.

Finally, the Federal Reserve, led by Jerome Powell, is expected to be able to overcome existing problems, reduce inflation, and eliminate financial market vulnerabilities. S&P forecasts that the consumer price index should not exceed 2.8% in 2024, falling to 2% in 2025. In 2026-2027, inflation should fluctuate between 2.3% (2026) and 2.1% (2027).

In early March, Fitch had already affirmed the long-term foreign currency sovereign rating of the United States at “AA+” with a “stable” outlook.