Moody's says will downgrade US AAA if June 15 debt payment missed, per Bloomberg.

On Thursday, credit rating agency DBRS Morningstar placed the United States under review for a potential downgrade due to the ongoing debt ceiling negotiations in Washington. This move comes shortly after a similar warning from Fitch.

DBRS stated that the "Under Review with Negative Implications" status reflects the risk of Congress failing to timely increase or suspend the debt ceiling. The agency added that if Congress does not take action, the U.S. federal government will face difficulties in meeting all its financial obligations.

Fitch also recently placed the United States' 'AAA' rating on negative watch, indicating a possible downgrade if lawmakers do not raise the government's borrowing cap before it exhausts its funds, which could occur as early as next week.

Scope Ratings, another agency, had previously placed the United States' 'AA' rating under review this month due to long-term risks associated with the debt ceiling.

Negotiations between Democratic President Joe Biden's representatives and top congressional Republican Kevin McCarthy were described as productive during talks on Wednesday, as they aimed to reach an agreement to raise the $31.4 trillion debt ceiling.

However, with the Treasury setting a June 1 deadline, concerns are growing among investors that there may not be enough time to finalize a deal and prevent a catastrophic default.

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