Moody's threatens U.S. debt downgrade

Moody's Investors Service warned on Thursday that "if there is no progress on increasing the statutory debt limit in coming weeks, it expects to place the U.S. government's rating under review for possible downgrade."

While the emphasis on raising the debt ceiling could aid Democrats in negotiations, Moody's also said it "would like to see substantial deficit reduction" -- a caveat some Republicans, like House Ways and Means Chairman Dave Camp, R-Mich., have already seized on in the push for significant budget cuts to come with the debt ceiling vote.

Treasury has said it would start defaulting on its obligations as soon as August 2 if the debt ceiling is not raised; "if the government misses any interest payments, that would likely trigger a downgrade of one to three notches" from the United States' AAA rating, The Wall Street Journal reports.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by eSignLive by VASCO

    Mobile E-Signatures for Government

    Learn 5 key trends that accelerate government demand for mobile signing.

    Download
  • Sponsored by Management Concepts

    SPONSORED: Successful Change Management Practices in the Public Sector

    How governmental agencies implement organizational change management.

    Download
  • Sponsored by Kronos

    Solving the Workforce Compliance Challenge

    Download this eBook to learn how data and automation can help state and local agencies.

    Download

When you download a report, your information may be shared with the underwriters of that document.