Moody's cuts Puerto Rico's GO debt rating to Baa1

MIAMI Mon Aug 8, 2011 2:37pm EDT

MIAMI Aug 8 (Reuters) - Moody's Investors Service on Monday reduced its credit rating on Puerto Rico's general obligation debt to Baa1 from A3, saying the U.S. commonwealth was burdened by underfunded pension systems and a weak local economy.

Moody's also said in a statement that the outlook for the Caribbean's island's debt rating was negative and that it had assigned the Baa1 rating and negative outlook to two series of bonds worth more than $1 billion expected to be sold this week. (Reporting by Michael Connor)

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