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Moody's boosts California's credit rating, cites financial progress

Moody's boosts California's credit rating, cites financial progress
California's finances have improved enough to receive a credit upgrade from Moody's, a Wall Street ratings agency. Gov. Jerry Brown, pictured here with state lawmakers, signed a new budget into law last week. (Gregory Bull / Associated Press)

California's finances received a bump from Moody's on Wednesday, returning the state's credit rating to its highest level since 2001.

The Wall Street rating agency praised California's more stable budget process and a new effort to stockpile revenue for a rainy day.

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"The state's financial position is rapidly improving," Moody's said in its announcement.

Despite the upgrade, California is still two notches below the average credit rating for a state, Aa1.

California's new credit rating, Aa3, leaves it tied with Arizona and Connecticut. The only two states worse off are Illinois and New Jersey.

State Treasurer

Bill Lockyer

hailed Tuesday's announcement as evidence of California's financial progress.

"California in the last three years has made great strides in managing its financial affairs," he said in a statement. "Moody's action recognizes that progress and the strong, sustained fiscal discipline shown by the governor and Legislature."

Follow @chrismegerian for more updates from Sacramento.

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