Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
OR
Accept our Terms of Use to continue to Moodys.com:

PLEASE READ AND SCROLL DOWN!

By clicking “I AGREE” [at the end of this document], you indicate that you understand and intend these terms and conditions to be the legal equivalent of a signed, written contract and equally binding, and that you accept such terms and conditions as a condition of viewing any and all Moody’s inform​ation that becomes accessible to you [after clicking “I AGREE”] (the “Information”).   References herein to “Moody’s” include Moody’s Corporation, Inc. and each of its subsidiaries and affiliates.

Terms of One-Time Website Use

1.            Unless you have entered into an express written contract with Moody’s to the contrary, you agree that you have no right to use the Information in a commercial or public setting and no right to copy it, save it, print it, sell it, or publish or distribute any portion of it in any form.               

2.            You acknowledge and agree that Moody’s credit ratings: (i) are current opinions of the future relative creditworthiness of securities and address no other risk; and (ii) are not statements of current or historical fact or recommendations to purchase, hold or sell particular securities.  Moody’s credit ratings and publications are not intended for retail investors, and it would be reckless and inappropriate for retail investors to use Moody’s credit ratings and publications when making an investment decision.  No warranty, express or implied, as the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any Moody’s credit rating is given or made by Moody’s in any form whatsoever.          

3.            To the extent permitted by law, Moody’s and its directors, officers, employees, representatives, licensors and suppliers disclaim liability for: (i) any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with use of the Information; and (ii) any direct or compensatory damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud or any other type of liability that by law cannot be excluded) on the part of Moody’s or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with use of the Information.

4.            You agree to read [and be bound by] the more detailed disclosures regarding Moody’s ratings and the limitations of Moody’s liability included in the Information.     

5.            You agree that any disputes relating to this agreement or your use of the Information, whether sounding in contract, tort, statute or otherwise, shall be governed by the laws of the State of New York and shall be subject to the exclusive jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan.​​​

I AGREE
Rating Action:

Moody's affirms United States' Aaa rating; maintains stable outlook

25 Apr 2018

New York, April 25, 2018 -- Moody's Investors Service ("Moody's") has today affirmed the Government of United States of America's (US') Aaa long-term issuer and senior unsecured ratings. The outlook remains stable.

The affirmation of the US' Aaa rating reflects the US' exceptional economic strength, the very high strength of its institutions and its very low exposure to credit-related shocks given the unique and central roles of the US dollar and US Treasury bond market in the global financial system. Together, these features counterbalance the US' lower -- though still high -- fiscal strength.

The key driver for the stable outlook is Moody's view that the diversity, dynamism, and competitiveness of the US economy, along with the US dollar's status as the preeminent international reserve currency and very large size and depth of the US Treasury market, offset rising fiscal pressures stemming from ageing-related entitlement spending, higher debt service payments, and recent policy actions that will likely reduce future revenues and increase expenditures.

The US' long-term country ceilings for local- and foreign-currency bond and bank deposits remain unchanged at Aaa. Its short-term country ceilings for foreign-currency bonds and bank deposits remain unchanged at Prime-1 (P-1).

A full list of affected ratings is provided towards the end of this press release.

RATINGS RATIONALE

RATIONALE FOR Aaa RATING

EXCEPTIONAL ECONOMIC STRENGTH, VERY HIGH INSTITUTIONAL STRENGTH, AND VERY LOW EXPOSURE TO CREDIT RELATED SHOCKS OFFSET LOWER -- THOUGH STILL HIGH -- FISCAL STRENGTH

Moody's sovereign ratings reflect its assessment of economic, institutional and fiscal strength, along with susceptibility to potential shocks. In Moody's view, the US' combination of exceptional economic strength, very high institutional strength and extremely low exposure to credit-related shocks continues to support its Aaa rating, notwithstanding a slight decline in institutional strength and the more material ongoing erosion in fiscal strength.

The very high degree of diversification, dynamism, competitiveness and rich resource endowment reflected in the US economy's large scale, very high income levels and relatively supportive demographic trends underpin the US' very high economic strength. Moody's generally views the relative size of an economy as a reasonable proxy for economic diversification, which helps to mitigate potential sector-specific shocks. By this standard, the US is exceptional. With nominal GDP of close to $20 trillion in 2017, the US economy is by far the world's largest in nominal terms.

The US' dynamism and competitiveness are reflected in its global competitiveness rankings, such as those of the World Economic Forum's Global Competitiveness Index and the World Bank's Ease of Doing Business report. These attributes reflect the flexibility of the US labor market, mobility of its population, high level of entrepreneurial activity, presence of globally competitive universities and research institutions, and relatively low regulatory and tax burden. Finally, the country's long track record of maintaining high competitiveness and a conducive business environment has produced meaningful income gains over time. At about $58,000 GDP per capita in Purchasing Power Parity (PPP) terms in 2016, the US' very high average income level implies higher economic shock absorption capacity than in many other Aaa-rated sovereigns.

The US' economic prowess is supported by the very high strength of its institutions. Worldwide Governance Indicators suggest that key institutional features, including the effectiveness of government, rule of law and control of corruption, rank very highly, albeit slightly below those of the US' Aaa-rated peers. The credibility and effectiveness of monetary policymaking is a key pillar of the US' institutional strength. Fiscal policymaking, however, is less robust than in many Aaa-rated peers and experience in recent years suggests that the US' legislative and executive branches will be challenged to undertake a pronounced shift in fiscal policy in order to sustainably address rising fiscal pressures. Nevertheless, overall the US' institutions remain -- from a credit perspective -- close to first order.

Fiscal strength is of a lower order but still high. As a result of interventions to support the financial system and economy during the global financial crisis and the resulting recession, over the past decade cumulative fiscal deficits have driven the US federal government debt to one of the highest levels globally and the highest level among Aaa-rated sovereigns. However, the US' fiscal strength remains high relative to the Moody's rated universe of sovereigns. Moody's assessment of the US' fiscal strength incorporates the rating agency's expectation that federal government deficits will continue to widen somewhat over the medium term, contributing to a higher debt burden and lower debt affordability.

The strength of the US economy has, over the course of the twentieth century, helped the US establish and maintain the dominant positions of its currency and financial markets in the global financial system. Today, the US dollar is the world's preeminent reserve currency, with over 60% of global foreign exchange reserves held in dollar-denominated assets. Meanwhile, with total public debt outstanding of about $15 trillion, the US Treasury bond market is by far the deepest and most liquid government securities market in the world. A significant proportion of US Treasuries are held by non-residents, reflecting their preeminent safe-haven status.

The global benchmark roles of the US dollar and US Treasury market insulates the US economy, bond market, and financial system from many downside sovereign risks. In particular, they remove all but the most extreme liquidity risks from the US government securities market, despite a rising debt burden, and grant the US effective immunity from government liquidity and balance-of-payment risks.

RATIONALE FOR STABLE OUTLOOK

SIGNIFICANT AND UNIQUE CREDIT STRENGTHS COUNTERBALANCE EMERGING RISKS FROM ERODING FISCAL STRENGTH

Moody's sees little prospect of the US' economic strength diminishing materially in the foreseeable future. Even if the rate of growth continues its secular decline, the economy's other attributes will continue to support overall economic strength. The economy's relatively quick recovery from the global financial crisis illustrated its resilience even to a very severe shock, and while a further shock -- for example to trade flows -- could undermine growth, the underlying resilience of the economy is unlikely to be impaired. While the US economy is not immune to the risk of gradual erosion, as suggested by declining growth potential and perhaps by the emerging aversion to open trade and foreign labor, Moody's expects it to remain a highly supportive feature of the country's credit profile for many years to come.

Similarly, there is no near-term prospect of the benchmark status of the US dollar and US Treasury market being undermined. Their global safe-haven status was reinforced during the global financial crisis, and while the US Treasury market experiences rises and falls in yields, the likelihood of sharp yield spikes that signal prolonged liquidity pressures is far below that which tends to be experienced by other sovereigns with similar fiscal characteristics.

These continuing strengths offset the ongoing erosion of the US' fiscal strength. Looking ahead over the next decade, the US faces adverse fiscal dynamics due to rising ageing-related entitlement spending, higher debt service payments, and recent policy actions that will likely reduce future revenue intake and increase expenditure. As a result, Moody's current baseline forecast is that in the absence of a shift in policy the sovereign's debt burden and debt affordability metrics will weaken further over the coming decade.

WHAT COULD CHANGE THE RATINGS DOWN

Moody's would consider changing the outlook on and ultimately moving the US' rating if it were to conclude over the coming years that US policymakers do not have the capacity to respond decisively to mitigate the country's adverse fiscal dynamics over the medium term. On the basis of current policy settings, Moody's estimates that the federal government debt burden and interest-to-revenues ratio will rise by around 30 percentage points and 15 percentage points respectively over the next decade. Absence of effective policy action over the coming years to arrest such a rise would signal a further erosion of both fiscal and institutional strength, which would weigh on the sovereign credit profile, particularly if Moody's were to conclude that this would likely undermine the US' exceptional economic strength and the unique and central roles of the US dollar and US Treasury bond market in the global financial system.

GDP per capita (PPP basis, US$): 57,608 (2016 Actual) (also known as Per Capita Income)

Real GDP growth (% change): 1.5% (2016 Actual) (also known as GDP Growth)

Inflation Rate (CPI, % change Dec/Dec): 2.1% (2016 Actual)

Gen. Gov. Financial Balance/GDP: -4% (2016 Actual) (also known as Fiscal Balance)

Current Account Balance/GDP: -2.4% (2016 Actual) (also known as External Balance)

External debt/GDP: 87.2% (2016 Actual)

Level of economic development: Very High level of economic resilience

Default history: No default events (on bonds or loans) have been recorded since 1983

On 23 April 2018, a rating committee was called to discuss the rating of the United States of America, Government of. The main points raised during the discussion were: The issuer's economic fundamentals, including its economic strength, have not materially changed. The issuer's institutional strength/framework have slightly decreased. The issuer's fiscal or financial strength, including its debt profile, has not materially changed. The issuer's susceptibility to event risks has not materially changed.

The principal methodology used in these ratings was Sovereign Bond Ratings published in December 2016. Please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.

LIST OF AFFECTED RATINGS

Outlook Actions:

..Issuer: United States of America, Government of

....Outlook, Remains Stable

Affirmations:

..Issuer: United States of America, Government of

.... Issuer Rating, Affirmed Aaa

....Senior Unsecured Notes, Affirmed Aaa

The weighting of all rating factors is described in the methodology used in this credit rating action, if applicable.

REGULATORY DISCLOSURES

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

William Foster
VP - Senior Credit Officer
Sovereign Risk Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

Yves Lemay
MD - Sovereign Risk
Sovereign Risk Group
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454

Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

No Related Data.
© 2018 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL, FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.

CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for appraisal and rating services rendered by it fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors. It would be reckless and inappropriate for retail investors to use MOODY’S credit ratings or publications when making an investment decision. If in doubt you should contact your financial or other professional adviser.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for appraisal and rating services rendered by it fees ranging from JPY200,000 to approximately JPY350,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.