ISTANBUL 

Large primary deficits and higher interest service costs will keep the US' debt burden increasing after November elections, regardless of which candidate wins, according to Fitch Ratings.

"A possibly divided government would continue to complicate policy formation, and we believe there is currently little political appetite to tackle important fiscal challenges," the rating agency said Thursday in a statement. "Trends in government debt dynamics and governance will continue to shape the U.S.’s sovereign rating trajectory."

Fitch said fiscal issues are expected coming into focus early in the next administration, while the 2025 fiscal year appropriations are likely to remain unresolved until early next year, noting that the debt ceiling suspension terminates at year-end.

"History suggests there will be pressure to extend tax cuts regardless of who wins the elections," it said. "Neither presidential candidate has advocated meaningful entitlement reform even with social security and Medicare funds expected to be depleted by 2033 and 2036, respectively."

Fitch said it expects the US' medium-term nominal GDP growth close to 3.7%, but said high deficits mean this would not stabilize general government debt.