The punt: NTMA correct on Moodys blues

Head of NTMA John Corrigan

The Punt thinks John Corrigan may have a point about Moodys after all. Last month the head of the NTMA admitted to being "somewhat frustrated" at the agency's refusal to lift the Irish debt rating from "junk" status.

We were inclined to think Mr Corrigan was over-egging the pudding. Moodys might have a point, we thought, what with the national debt stuck at well over 100pc of GDP.

But now we're not so sure.

Moodys is sticking with its "AAA" assessment of US bonds, even though the whole world is by now aware that powerful elements within the American political system are currently threatening to default, potentially as soon as this week.

It isn't even that the US can't pay, just that maybe it won't.

Most people think America will be pulled back from the brink; even if they don't it's hard to see the mighty military power come off particularly badly in a spat over a bit of overly enthusiastic borrowing.

But Moodys has to admit there is a chance of a near-term US default – so why the "AAA"? So we're starting to think John Corrigan might be right, maybe the Moodys Irish view really is inexplicable.

After all there is a more or less zero chance of an Irish debt default in the near term – its the kind of thing you can say when you know someone has €25bn in the bank.

So come on rating agencies, if the USA is A OK it's surely time to lift John Corrigan's Moodys blues.