The U.S. state sector could be approaching a period of credit rating volatility, Standard & Poor's Ratings Services says.
"By most measures, U.S. state budget conditions are adequate to favorable," said credit analyst Gabriel Petek. "And yet, a majority of states face budget gaps in either fiscal 2015, 2016, or both." "The fact that so many states confront shortfalls at all serves as an early warning of sorts," he said.
"After all, if a state is grappling with a budget deficit now, with the economic expansion approaching its sixth anniversary, what will be its condition when the next slowdown strikes?"
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