Fitch Ratings still expects US growth, but downgrades sectors on deterioration concerns

FXStreetJul 21, 2025 7:59 PM

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The Fitch Ratings Agency downgraded key US industry sectors to "deteriorating" on Monday, citing still-unclear policy guidance impacting US credit conditions. Even after months of turbulence, the Trump administration appears no closer to settling into a steady governance structure, specifically when it comes to trade and tariffs, two key aspects that can have significant impacts on US consumers in particular.

Key highlights

Policy risks cloud US credit outlook.
25% of US sector outlooks have been downgraded to 'deteriorating' in 2025.
Fitch cites increasing uncertainty, slowing growth, and higher-for-longer interest rate expectations.
Recession risk has declined thanks to easing US-China trade tensions, but over business and consumer confidence has weakened.
US Gross Domestic Product (GDP) growth forecast increased to 1.5% from 1.2%, but momentum is expected to continue slowing through the year.

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