Muni-Bond Downgrades Rare Even With Few Spared Pandemic’s Blows
- Moody’s and S&P have downgraded about 1% of rated entities
- Rating cuts more frequent in 2018 amid economic expansion
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Even as America’s states and cities brace for hundreds of billions of dollars tax collections to disappear, the two biggest credit-rating companies have been slow to downgrade municipal debt amid increasing risk for the $3.9 trillion market.
Since the pandemic raced through the U.S., S&P Global Ratings Inc. and Moody’s Investors Service have downgraded about 1% of the municipal borrowers they rate, even as sports stadiums close, college towns and dormitories are emptied after some campuses canceled in-person classes, and the steep drop in travel batters airports and tourism-driven cities.