Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options. HOMEPAGE

Moody's: U.S. Downgrade Would Trigger 7,000 Municipal Ratings Cuts

Moody's will downgrade at least 7,000 top-rated municipal credits if the U.S. loses its AAA grade, according to a statement from the ratings agency.

Advertisement

The automatic downgrades that will affect $130 billion in municipal debt directly linked to the U.S. government, including mortgage-backed bonds secured by the U.S., as well as agencies like Fannie Mae and Freddie Mac.

bungee jump
A different kind of trust fall for your employees. Flickr Carla MacNeil

Moody's will also review other top-rated securities indirectly linked to the federal government, such as state governments, housing authorities, and nonprofits.

Bloomberg reports that that 15 U.S. states currently have AAA ratings. Other top-rated issuers include 440 local governments, 100 state housing bond programs, 43 higher-ed and nonprofits, 43 state revolving-fund bond programs, the Tennessee Valley Authority, and the Bonneville Power Administration. 

Debt Ceiling
Advertisement
Close icon Two crossed lines that form an 'X'. It indicates a way to close an interaction, or dismiss a notification.

Jump to

  1. Main content
  2. Search
  3. Account