Moody's warns that US government shutdown would be 'credit negative'

<p>I don't get the sense that the public is in any mood for a US government shutdown, especially after the ridiculous debt ceiling theatrics in May but I will never underestimate the stupidity of politicians.</p><p>Hundreds of thousands of US government workers will be furloughed starting on Oct 1 if Congress fails to pass a funding bill. It would also mean that US economic data publication is halted indefinitely. </p><p data-test>"A
shutdown would be credit negative for the US sovereign," Moody's, which
has a triple-A rating for the U.S. government, said in a statement. "In
particular, it would demonstrate the significant constraints that
intensifying political polarization put on fiscal policymaking at a time
of declining fiscal strength, driven by widening fiscal deficits and
deteriorating debt affordability."</p><p data-test>The longer the shutdown lasts, the more negative it would be, Moody's said.</p><p data-test>Fitch downgraded the US in August and said one of the reasons was the debt ceiling drama. Moody's is the only major credit ratings agency that has a top credit rating for the US.</p>

This article was written by Adam Button at www.forexlive.com.