S&P expects US debt growth and budget deficit this year

US, WASHINGTON (ORDO NEWS) — S&P Global Ratings joined the previously announced Fitch Ratings, confirming US sovereign ratings at “AA +” / “A-1 +” with a “stable” outlook.

Nevertheless, the agency noted that they expect a deterioration in the situation with public debt and the US budget deficit this year after the “economic shock” caused by the pandemic.

Rating agency experts added that they expect the United States economy to recover in 2021, which partly compensates for the losses of 2020 and will lead to a moderate improvement in the financial situation after a “sharp” increase in the budget deficit and the sovereign debt burden.

“We expect the US economy to contract by 1.3% this year before recovering by 3.2% in 2021 and 2.5% next year,” the rating agency said.

Fitch warned last week that even before the massive economic turmoil caused by the spread of coronavirus, the country’s already high and growing debt and budget deficit began to undermine its financial stability.

Coronavirus death toll in the US, according to Reuters , exceeded 5800 people, it was known about 240 thousand cases of infection. The government urged Americans to follow strict measures of social distance in anticipation of a “difficult two weeks,” which, according to authorities, could lead to the death of at least 100 thousand people.

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