Moody’s May Cut US Bond Ratings

New york, June 28: | Updated: Jun 29 2002, 05:30am hrs
Moody’s Investor Service said it may downgrade the ratings of certain US treasury bonds — considered to have virtually no risk of default — unless a deal is soon reached between Congress and the treasury to raise US debt ceiling.

But Moody’s said the overall US government debt rating — at “Aaa” the highest possible rating — and the country’s credit fundamentals would not be impacted by the debt ceiling issue.

“Moody’s feels that the treasury will be able to meet its payments during most of July, but the picture becomes less clear thereafter,” Moody’s said in a statement.

The treasury and Congress have locked horns over raising the nation’s $5.95 trillion debt ceiling, which the treasury has said would be reached on

Friday. Late on Thursday congressional aides said the House of Representatives would vote in the evening on approving a measure that would lift the debt by $450 billion. The senate has already passed such a measure.

Reuters