In July 2025, President Donald Trump signed into law a sweeping piece of legislation dubbed the “One Big Beautiful Bill Act.” This new law includes significant tax cuts along with reductions in government spending. While the bill aims to stimulate the economy, it also results in a projected increase of $3.4 trillion in the U.S. federal deficit between 2025 and 2034, according to the Congressional Budget Office (CBO).
Despite this, S&P Global announced on August 19, 2025, that it will maintain the United States’ long-term credit rating at AA+, and its short-term rating at A-1+. The agency believes that the U.S. will collect “meaningful” revenues through tariffs, which will help counterbalance the effects of reduced tax income caused by the new legislation.
S&P emphasized that its stable outlook depends on the strength of American institutions and continued trust in the independence of the Federal Reserve. Any political disruptions that might weaken these pillars could threaten not only the credit rating but also the U.S. dollar's global dominance as a reserve currency.
Since returning to office, President Trump has implemented high tariffs on a wide range of imported goods. According to the Treasury Department, this has already led to a $21 billion increase in customs duties collected in July alone. While the federal deficit rose by nearly 20% during that same period, S&P argues that tariff income can still play a major role in easing the fiscal gap.
The rating agency also acknowledged that even though the deficit remains high, it does not expect it to get significantly worse in the near future. It sees the U.S. economy as resilient and diverse, with effective monetary policy and a debt ceiling that was recently increased by $5 trillion. This combination, according to S&P, should help the country absorb the financial impact of the new tax and spending policy.
Overall, the agency maintains confidence that the U.S. will continue to manage its finances responsibly, as long as policy remains stable and revenue from tariffs remains strong.
