Moody's warns US not to back off deficit cuts

By MARTIN CRUTSINGER | November 23, 2011 | 4:10 PM EST

WASHINGTON (AP) — Moody's Investors Services warns it could downgrade the U.S. government's top credit rating if Congress backs off $1.2 trillion in automatic deficit cuts scheduled over the next decade.

The credit rating agency says it will not lower the nation's rating on long-term debt after a special congressional panel failed this week to reach agreement on alternative cuts to the deficit.

The impasse triggered the automatic cuts, which are scheduled to kick in beginning in 2013. Moody's said any effort to reduce those cuts could force the agency to downgrade its rating.

Moody's currently has U.S. government debt with a top rating of Aaa but with a negative outlook.