Moody's has raised its outlook on U.S. debt to stable, shedding the negative outlook that it has maintained for nearly two years.
The move reflects a decline in the U.S. budget deficit, which is expected to continue to shrink over the next few years, in conjunction with a moderately improving U.S. economy, Moody's said in its report released late Thursday.
Moody's also affirmed its top rating -- Aaa -- for the U.S. government, noting that the nation's "debt trajectory is on track to meet the criteria laid out in August 2011 for a return to stable outlook."
The rating agency referred to an estimate from the Congressional Budget Office that the budget deficit for the 2013 fiscal year is expected to decline to 4% of GDP from its 2012 level of 7%.
The U.S. gross domestic product rose at a 1.8% annual rate during the first quarter of the year, which is anemic, but still positive.
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