Moody’s expects to cut US rating without deal to lower debt/GDP ratio
- Budget negotiations likely to determine AAA rating and outlook
- If budget talks do not produce downward trend in debt-to-GDP ratio, rating likely to be lowered to AA1
- Assumes “relatively orderly” process for increasing debt limit
- The full Moody’s statement is here
For whoever wins the election, getting the votes from the public will be the easy part. Getting the votes in Congress will be painful.