So the great USA no longer has a perfect credit score. Moody’s is the latest ratings agency to downgrade them. So what’s next? 

In case you missed it, global ratings agency Moody’s downgraded the United States’ credit rating from a perfect triple A to double A1.

Now, Aa1 is still pretty good. It’s actually the second-best score on Moody’s scale. But it’s the first time since 1917 that Moody’s hasn’t held a perfect score for the US. It also marks the first time in over a century that the US has lost its perfect credit score from all three major rating agencies. 

Standard and Poors downgraded the US in 2011, and Fitch in 2023. 

According to Moody’s, the decision was based on increasing concerns over the USA’s rising debt, which has reached 36.2 trillion USD, and the increasing costs of interest payments.

Now the Trump administration says their  “big, beautiful bill” will address some of these issues, strengthen the economy and create jobs. 

The proposed 3 trillion US dollar budget, which is literally called the “One Big Beautiful Bill Act” includes significant tax cuts and spending reductions. 

But experts are saying that the budget’s policies could actually increase the national debt, leading to higher borrowing costs and lower investor confidence.

What does that mean for Americans?

Well, we know that a lower credit rating affects interest rates on loans. Interest rates on US mortgages have already climbed above 7 percent, and borrowing costs for credit cards and auto loans have increased. 

That means higher monthly payments for a lot of people.

Which in turn means that Caribbean countries like Jamaica that depend on remittances and tourism could also get a hit.

And that’s the bottom line.

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