June 19, 2009 / 3:41 PM / 10 years ago

Moody's says may downgrade California's GO debt

NEW YORK, June 19 (Reuters) - Moody’s Investor Service on Friday placed California’s general obligation debt on alert for a possible downgrade, citing the state’s strained public finances.

The rating agency rates California at A2, or its sixth-highest investment grade.

The action reflects an expected budget gap for fiscal 2010 of more than $20 billion, or more than 20 percent of the general fund budget; the announcements by the state controller that without solutions California will not be able to meet all its financial obligations in July; a continued political stalemate, and the limited options available to the state, Moody’s said.

A lack of action could result in a multi-notch downgrade, said Moody’s. (Reporting by Ciara Linnane; Editing by Leslie Adler)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below