Rating agency Moody’s has threatened to downgrade the US’s prized triple A credit rating if Congress fails to reach a deficit reduction deal, raising the stakes in the fiscal debate that lies at the heart of the November election.
Moody’s said yesterday that it was considering joining its rival Standard & Poor’s – which stripped the US of its top rating last year – if a deal was not reached by the end of the year.
The threat is likely to feed into election campaign concerns over the state of the economy and lift Republican hopes of a boost for Barack Obama’s challenger, Mitt Romney, by focusing attention on the size of the national debt.