CHICAGO — There are likely to be “more severe” financial market and economic consequences if Congress fails to raise the debt limit than if Congress fails to avoid a government shutdown, according to a report from Moody’s Investors Service.

“Although the expenditure reduction under the debt limit scenario is smaller, the perception that the U.S. government could default on servicing its debt if the debt limit is not raised could roil financial markets and damage business and consumer confidence,” the rating agency said.

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