Chinese agency Dagong cuts U.S. sovereign ratings to BBB+ from A-

Source: Reuters

BEIJING (Reuters) - China’s Dagong Global Credit Rating Co, one of the country’s most prominent ratings firms, on Tuesday cut the local and foreign currency sovereign ratings of the United States, citing an increasing reliance on debt in the world’s largest economy.

Dagong said in a statement that it cut the sovereign ratings to BBB+ from A- and also placed them on a negative outlook.

The growing reliance on the debt-driven mode of economic development will continue to erode the solvency of the U.S. federal government, the Beijing-based ratings agency said.

In December, U.S. President Donald Trump signed into law a package of tax cuts that will add $1.4 trillion over a decade to the $20 trillion national debt.

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