Democratic sweep positive for US credit rating outlook, Scope Ratings says
SPY•Scope Ratings said Democratic control of both chambers of Congress was credit positive for the US sovereign rating and supported its AA- rating and stable outlook. It expects deficits of around 7%-8% of GDP and US debt to rise from 124% of GDP in 2025 to around 145% by 2031.
1. Rating outlook
Scope Ratings said the Democrats’ gains in both the House and Senate, and President Donald Trump’s swift acceptance of Republican defeats, confirmed the resilience of US checks and balances. It described the rebalancing of power between the White House and Congress as credit positive, supporting the US’ AA- rating and stable outlook.
2. Fiscal pressures
Scope expects a Democratic-controlled Congress to close most legislative routes for the Trump administration, raising the stakes of annual budget negotiations and constraining its domestic policy agenda. It expects fiscal policy to remain broadly unchanged, with headline deficits around 7%-8% of GDP, but said appropriations and debt-limit negotiations could become more protracted. Scope expects US debt to rise from 124% of GDP in 2025 to around 145% by 2031, the second highest among advanced economies after Japan.
