US Politics

Kevin McCarthy’s historic removal as Speaker threatens US credit rating downgrade

Moody’s has said that its confidence in the US is wavering because of concerns about governance

  • October 4, 2023
Kevin McCarthy, the House speaker, was removed from his position on Tuesday after a Republican backlash. Picture: Anna Moneymaker/Getty Images

The historic ousting of Republican Kevin McCarthy as Speaker of the House may add to the risk of a US sovereign credit-rating downgrade and further roil markets, according to strategists.

McCarthy’s exit from the leadership role is likely to set off a bout of political uncertainty in Washington on matters such as federal spending, and brings into focus the potential for government shutdowns as legislators wrangle over budgetary allocations.

Markets reacted, too. Treasuries extended losses ...