Moody's: U.S. Budget Debate Positive Despite Uncertain Outcome

Washington's debate over its budget is positive despite uncertainty over the outcome, as it is a potential change in the direction of fiscal policy, rating agency Moody's Investors Service said on Monday.

Moody's assessment of the budget debate came as rival agency Standard & Poor's downgraded its outlook on the United States but kept its coveted AAA-rating on the world's largest economy due to concerns over its fiscal situation.

"This potential change in the direction of fiscal policy is credit positive for the US federal government (Aaa stable), although it remains uncertain what sort of budget will actually be adopted," Moody's said its latest weekly credit outlook.

It said that United States stands out from other major countries not yet having a plan for reversing its upward debt trajectory.