After the closing bell on Friday, Moody’s became the last major credit-rating firm to downgrade U.S. sovereign debt from its perfect AAA status to Aa1. The firm argues that the U.S. is on a trajectory to increase entitlement spending—without the necessary government revenues to keep interest payment ratios at levels similar to other sovereign nations.

The Moody's announcement follows similar actions from Fitch and S&P in recent years and could result in higher borrowing costs.