The state of the United States' economy is much shakier than previously thought under President Donald Trump's leadership, according to one major international bank.
The New Republic reported Tuesday that Deutsche Bank managing director Jim Reid, who is the bank's global head of macro research and thematic strategy, is now expressing increasing worry that Trump's policies are gradually wrecking the economy. In a memo obtained by Fortune, Reid remarked that the recent decision by Moody's to downgrade the U.S. credit rating from AAA to AA1 for the first time in history could be a harbinger of tougher economic times in the near future.
“Yesterday felt like we were somewhere along the line of a ‘death by a thousand cuts’ with regards to the U.S. fiscal situation,” Reid wrote. “Hard to know where in that thousand we are but probably much nearer a thousand than at zero even as yesterday saw an initial sell-off reverse as the session went on."
READ MORE: 'Reeking corruption': 16 Senate Dems join Republicans to advance Trump bill
“At the end of the day the loss of the final U.S. triple-A rating late on Friday night doesn’t change anything much immediately but it keeps the drip, drip, drip of poor fiscal news building up against the debt sustainability dam in the background," he added.
Moody's cited the growing U.S. national debt – which is in excess of $36.8 trillion – as a primary reason for the downgrade, and analysts opined that policy proposals currently under consideration by the Republican-controlled Congress would only worsen the United States' long-term debt outlook. The credit downgrade could jeopardize efforts by the U.S. to borrow money in the future, and could increase the cost of debt service obligations.
One major component of the Republican megabill that House Speaker Mike Johnson (R-La.) is attempting to pass before the Memorial Day holiday is an extension of Trump's 2017 tax cuts — which have been criticized as overwhelmingly tilted in favor of the rich. One estimate pegged a 10-year extension of those tax cuts at roughly $4.6 trillion.
The Republican-controlled House Budget Committee are scheduled to vote on the bill early Wednesday morning at 1 AM. However, its fate in the full House remains unknown, as multiple Republicans have expressed concern about the legislation's impact on the federal deficit.
READ MORE: 'Who's going to tell him?' Trump mocked as Kennedy Center lineup features notorious drag productions
Click here to read the New Republic's full article.