Jakarta, CNBC Indonesia- Rating agency Moody’s cut the credit rating of the United States (US) to “negative” from the previous level of “stable” on Friday (10/11).
This assessment refers to an increase in the risk of a fiscal deficit and a decrease in the ability to pay debts. Apart from that, the strengthening polarization ahead of the presidential election was the reason Moody’s cut the US rating.
Sucor Sekuritas economist, Ahmad Mikail, said that the consequences of cutting the US debt rating will mean that US Treasury yields are expected to remain at a high level for quite some time. This condition will later encourage the chances of a US recession to increase in 2024.
How do economists see the impact of a US debt downgrade on the US economy? What is the effect on financial markets? For further details, see Syarifah Rahma’s dialogue with Sucor Sekuritas Economist, Ahmad Mikail at Power Lunch,CNBCIndonesia (Wednesday, 11/22/2023)