Since the U.S. hit its statutory debt limit last month, the country has been struggling on reaching an agreement on lifting its national debt ceiling. However, the slow progress on the discussion has drawn Moody's concern; it warns of a possible downgrade.

Moody's said on Thursday that it expected to put the U.S. government's rating on review for possible downgrade if there is no progress on increasing the statutory debt limit in coming weeks. 
  
The agency says the Aaa rating will be maintained if the debt limit is raised and default avoided. However, the rating outlook will depend on the outcome of negotiations on deficit reduction.
  
Moody explains the debt limit negotiations in Washington represent a real near-term opportunity for fiscal consolidation.

Therefore, failure to reach an agreement would increase the likelihood of a negative outlook in the near term, because the upward debt trajectory would still be in place.

The rating agency also announces to place Bank of America, Citigroup and Wells Fargo under review with a negative outlook.

Moody's says the current ratings of them are unusually uplifted by the U.S. government.

However, it assumes the government bailout of the biggest U.S. banks might no longer apply.

Shares of the three banks declined on Thursday following Moody's announcement.

The announcement also triggers series of chain reactions on markets.

Along with the weaker-than-expected initial jobless claims data, the U.S. dollar fell against major currencies in late New York trading on Thursday.
  
Meanwhile, In Europe, the debt-burdened Greece agreed to a new 6.4-billion-euro deficit cut plan, which helped the euro rally more than 1 percent against the dollar.

In late Thursday trading, the dollar bought 80.84 yen, comparing with 80.97 yen late Wednesday, and the euro rose to 1.4482 dollars from 1.4374.

The weaker dollar lifted U.S. crude oil prices on Thursday.

But there are sources saying the Organization of Petroleum Exporting Countries (OPEC) may raise output to help bring down the high fuel prices.
  
And according to the report of U.S. Energy Information Administration, the U.S. crude inventories rose 2.9 million barrels in the week ended May 27.

More U.S. crude supply pressured the prices.
  
Light, sweet crude for July delivery rose moderately 11 cents to settle at 100.40 dollars a barrel on the New York Mercantile Exchange.