Fresno, California, had its ratings on $462 million of debt lowered one step by Moody's Investors Service because of deteriorating finances.

The city's long-term issuer rating was cut to A3, the fourth-lowest investment grade, from A2. Its pension obligation bonds were downgraded to Baa1, third-lowest, from A2 and its lease-revenue bonds fell to Baa2, one step lower, from Baa1, the New York-based rating company said yesterday in a statement. The outlook for the ratings is negative, meaning another downgrade is possible.

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