April 29, 2013 / 4:11 PM / 6 years ago

Moody's: High pace of US public finance downgrades continues

WASHINGTON, April 29 (Reuters) - Moody’s Investors Service continued to downgrade more public finance ratings than it upgraded in the first quarter of 2013, primarily because of cuts to California local governments, the rating agency said on Monday.

“We expect rating activity to continue to be skewed toward downgrades over 2013 as local governments continue to struggle with increasing pension and healthcare costs and constraints on key property tax and state aid revenue sources,” Moody’s Assistant Vice President and Analyst Eileen Hawes said in a statement.

Local governments across the country dominated the downgrades, but California’s cities and counties “dictated much of the rating activity during the first quarter,” with about $19 billion of their debt downgraded, compared to a little more than $7 billion bonds upgraded.

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