"US policy direction is not likely to change significantly following the November 6 US midterm elections… The rating agency expects President Donald Trump's administration to continue to drive federal policy in the key areas of trade, healthcare and immigration over the next two years, with varying credit impact across sectors," the statement reads.
"Amid high levels of political polarization, passing major legislation through a split Congress will be challenging and we expect the administration will likely continue to advance its policy goals using executive powers and administrative rulemaking rather than seeking legislative action. However, the likelihood of increased congressional scrutiny over the administration, led by the House, will slow the pace at which the executive branch can implement its agenda," Karnovitz said as quoted in the statement.
Moody's also considers that the United States would continue its trade war with China and maintain pressure in the area of investment and intellectual property issues.
The agency added that the US-Mexico-Canada Agreement on trade will be approved by the Congress in 2019. The United States held its midterms on Tuesday. According to the latest media reports, Democrats so far have a 220-193 lead in the lower house of Congress, while 218 seats are needed to secure a majority. Republicans will continue to be in control of the Senate after retaining their majority.