NEW YORK, Oct. 24 (Xinhua) -- German-based agency Scope Ratings on Friday downgraded U.S. credit ratings to AA- from AA.

The downgrade was driven by the sustained deterioration of public finances reflected in persistently elevated federal deficits, a rising net interest payment burden, and the weakening of governance standards, the agency said in a report.

The U.S. government deficit widened to 8.0 percent of GDP in 2024, well above the pre-pandemic average of around 4.8 percent between 2015 and 2019. The One Big Beautiful Bill Act has contributed to a weakening of the fiscal outlook. Scope expects the deficit to remain high at 7.4 percent of GDP in 2025, and average around 7.8 percent over 2026-2030, up from 7 percent at the time of its last rating action in May 2025.

Without additional corrective fiscal measures, the U.S. government debt ratio will reach 140 percent of GDP by 2030, up from 122 percent in 2024, according to the report.

Constrained budgetary flexibility, further exacerbated by the enactment of the OBBBA, limits the administration's ability to introduce sufficient spending cuts or revenue increases to stabilize the public debt ratio over the coming years.

Meanwhile, the weakening of governance standards lowers the predictability of U.S. policymaking, increases the risk of policy missteps, and reduces Congress's capacity to address the country's structural fiscal challenges, the report says. ■