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The international credit rating agency “Moody’s Investors Service” informed this Wednesday that today’s rating of the US government bonds (“AAA”) will be lowered if the economy doesn’t start to recover faster, and if no steps to decrease the country’s huge budget deficit are taken.

The announcement is a sign of investors’ growing concern in respect to the US deficit. The report by Moody’s shows an upward trend of the country’s debt. The company’s senior credit analyst Steven Hess says that the project for 2010’s budget recently presented by Obama’s administration shows no signs of relative stabilization of the debt level to GDP. So if no steps are taken to decrease the budget deficit, or if the economy doesn’t start to grow faster than they are already expecting it, the financial outlook for the next decade drawn by the federal government will have a serious impact on the government’s rating “AAA” – informs the explanatory note.

To remind you, the US administration issued financial forecasts this week. According to in, the budget deficit for 2010 will be $1.565 billion – that’s 10.6% of GDP, the highest ratio since WW II. By the year 2013, the government hopes to decrease the level to 4% of GDP.

In general, the ratio of debt of GDP will continue to rise from 53% in 2009 to 77% in 2020. Experts from Moody’s think that even those numbers are underestimated. More than 100% by the year 2020 is more likely – they predict.

Source: “Vedomosti”