Moody's warns could lower US triple-A rating

Moody's warned Tuesday it could strip the United States of its coveted triple-A credit rating if Congress fails to produce a budget that will bring down the federal debt burden. "Budget negotiations during the 2013 Congressional legislative session will likely determine the direction of the US government's Aaa rating and negative outlook," the ratings firm said in a statement.
If the negotiations lead to specific policies that produce a stabilisation and then downward trend in the ratio of federal debt to GDP over the medium term, the rating will likely be affirmed and the outlook returned to stable, it said. "If those negotiations fail to produce such policies, however, Moody's would expect to lower the rating, probably to Aa1." Moody's said it was unlikely it would keep the Aaa rating with a negative outlook into 2014.