Moody’s Cuts Outlook for New York City’s Debt

Citing the economic shocks wreaked by the World Trade Center tragedy and the national downturn, a Wall Street ratings agency Friday cut its outlook for the world’s financial capital to “negative” from “uncertain,” saying the strains would continue for the foreseeable future.

Moody’s Investors Service did not lower its rating for New York City’s $30 billion or so of debt, keeping it at A2, just two notches below the coveted top rating of triple-A. A lower bond rating could raise the city’s borrowing costs.

City officials were not available for comment.

The blow from Moody’s comes just one week before Mayor Rudolph Giuliani is expected to unveil a detailed analysis of how he expects the attacks to affect the city’s nearly $40-billion budget.

Giuliani in early October projected a $1.6-billion budget deficit and ordered $1 billion of budget cuts. His November plan, to be released Wednesday, will unveil further steps he might want to take before his term ends in January.