A major credit agency said on Thursday that US bond rating is under review as the White House and Republican leaders in Congress failed to reach a deal on raising the federal debt ceiling.
Moody’s Investments Service, one of the major credit rating agencies, placed the AAA bond rating of the US government on “review” for possible downgrade, noting a possible default of financial obligations in case the US did not raise the debt ceiling on “a timely basis”.
“The review of the US government’s bond rating is prompted by the possibility that the debt limit will not be raised in time to prevent a missed payment of interest or principal on outstanding bonds and notes”, said Moody in a statement.
“An actual default, regardless of duration, would fundamentally alter Moody’s assessment of the timelessness of future payments”, added the statement.
Meanwhile, Freddie Mac issued its survey of the US economy on Thursday, saying that 18,000 jobs were added last June but unemployment rate rose to 9.2 percent and mortgage rates also went down as a result.