Scope Warns US Debt Could Hit 160% of GDP

Scope Ratings warned that the United States is becoming increasingly vulnerable to shifts in investor sentiment as persistent budget deficits drive government debt and interest costs higher.

The European credit ratings agency on Friday maintained its AA- sovereign rating for the U.S. with a stable outlook. However, it cautioned that the country’s current fiscal path is unsustainable over the medium term unless stronger economic growth or significant changes to government spending and revenue improve debt dynamics.

Scope forecasts U.S. government debt will rise to approximately 160% of gross domestic product over the next decade. Net interest expenses are also projected to reach what the agency called an “exceptionally high” level by 2031, adding pressure to federal finances.

Without materially faster economic growth, higher government revenue or meaningful spending reductions, Scope expects U.S. debt trends to remain unfavorable. Continued borrowing could also make Treasury markets and U.S. finances more sensitive to changes in investor confidence.

The ratings agency additionally highlighted risks from the approaching congressional battle over the U.S. debt ceiling, an issue that has previously contributed to concerns about the country’s creditworthiness.

Scope currently rates U.S. sovereign debt at AA-, three levels below its highest possible rating. The agency downgraded the United States during the 2025 debt-ceiling dispute and maintains a more cautious assessment than several larger global ratings firms.

Its U.S. rating currently sits two levels below those assigned by Moody’s Ratings, Fitch Ratings and S&P Global Ratings. The United States no longer holds the highest possible sovereign credit rating from any major ratings agency following Moody’s downgrade last year.

Scope has generally taken a more conservative view of U.S. fiscal risks than its larger competitors. Fitch’s chief sovereign analyst said in January that another U.S. credit downgrade shortly after the agency’s 2023 action would be highly unusual.

Scope is one of five ratings agencies recognized by the European Central Bank for collateral assessments and is the only Europe-based company in that group.