March 28 Ratings upgrades of cities, states and
other U.S. local governments by Standard & Poor's outpaced
ratings cuts in 2012, a turnaround from 2011's mix and a sign
America's economy was steadying, the Wall Street credit group
said on Thursday.
"We believe this reflects that the economic recovery, while
remaining slow, gained traction in 2012," S&P said in a study.
"As a result, governmental tax revenues stabilized and, in the
aggregate, approached pre-recession levels."
During 2011, S&P had issued more ratings cuts than raises.
U.S. public finance, which pays for schools, roads and other
infrastructure, remains stable and sound, even though debt
defaults occurred in each sector, according to S&P.
Eleven public creditors defaulted on debts during 2012, in
comparison to an annual mean of 2.1 since 1986, S&P said. No
borrowers in housing defaulted.
"Four of the defaulted issues in 2012 held investment-grade
ratings prior to defaulting, while seven held speculative grade
ratings prior," S&P said. "Compared to previous years, the
number of defaults ... remained low, reflecting, in our view,
the generally resilient nature of the sector overall."