WASHINGTON Feb 1 Moody's Investors Service downgraded a record $311 billion public finance debt in 2012 due to economic and budget stresses, the rating agency said on Friday, adding that it expects the pace of downgrades to slow this year.
"The negative rating trend throughout the year reflects ongoing lackluster economic and industry conditions, stressed budgetary and reserve positions, challenging debt structures, and elevated pension funding pressures," it said in a special report. "For 2013, we expect an overall reduced pace of downgrades as economic recovery continues, and the housing sector begins to strengthen."
In comparison, the agency only upgraded the ratings on $24 billion of bonds. The number of downgrades rose 60 percent from 2011, as did the number of rating changes. The 7.2 percent of the 14,000 issuers Moody's rates were either upgraded or downgraded in 2012, double the 3.6 percent in 2011.