According to Moody’s, the current situation is a result of difficulties European and US economies are facing and a direct consequence of global imbalances.
"Fiscal consolidation and volatility in financial markets will continue to weigh on business and consumer confidence, while heightened uncertainty hampers spending, hiring and investment decisions."
Meanwhile, the International Monetary Fund (IMF) has also warned the US about the political deadlock between Republicans and Democrats over its looming fiscal cliff. The IMF urged Washington to reach an agreement over the series of tax increases and spending cuts as soon as possible.
The US has a debt of about USD 16 trillion.
The worsening debt crisis has forced EU governments to adopt harsh austerity measures and tough economic reforms, which have triggered massive demos in many European countries.
Moody’s credit rating agency has cut its next year’s outlook for leading world economies, saying that the struggle for member states of the Group of 20 (G-20) is expected to continue until 2014.
On Monday, the agency said that growth in emerging economies within the G-20 was expected to be slow, AFP reported.