Quick overview

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S&P Global Ratings reaffirmed the United States’ long-term sovereign credit rating at AA+ with a stable outlook, citing tariff revenues that could partially offset the negative fiscal impact of Donald Trump’s tax reform.

However, the agency cautioned about the country’s growing public debt and deepening political polarization.

According to S&P, the fiscal outcome will depend on how new budget measures are implemented, their interaction with tariff revenues, and their effect on growth and investment. The agency projects that the U.S. government deficit will average 6% of GDP between 2025 and 2028, an improvement from the 7.5% estimated for 2024 and the 9.8% average recorded between 2020 and 2023. Even so, federal net debt is expected to rise from 94% of GDP in 2024 to over 100% by 2028, nearing the historic high of 106% reached during World War II.

On the economic front, S&P forecasts that the United States will avoid a recession, though growth will slow to 1.7% in 2025 and 1.6% in 2026.

The agency emphasized the strength of U.S. institutions and the credibility of the Federal Reserve, which provide significant room to maneuver monetary policy. “We expect the Fed to meet the dual challenge of bringing inflation under control while managing financial market vulnerabilities,” the report noted.

Still, S&P said that its institutional assessment of the U.S. remains below that of some peers, reflecting a slightly higher degree of political polarization. The report also highlighted the flexibility of U.S. economic policy, pointing to a proactive and credible monetary policy framework and the country’s unique status as issuer of the world’s primary reserve currency.