Bloomberg NewsMoody's Ratings on Tuesday raised Houston's general obligation bond rating a notch to Aa2 in the wake of recent moves that greatly reduced the city's structural budget gap. Processing ContentThe rating agency pointed to "recurring and meaningful revenue enhancements and expenditure realignments" in Houston's $7.5 billion fiscal 2027 budget that slashed a projected budget gap to $26 million, or 0.83% of budgeted revenue, from an initial estimate of $209 million. "These actions materially reduced budgetary gaps and strengthened the city's forward-looking financial flexibility, with governance considerations serving as a key driver of the rating action," the Moody's report said. Mayor John Whitmire said he will continue to work to strengthen the city's financial position. S&P cited "substantial progress" in reducing the budget gap when it revised its outlook on Houston's AA GO bond rating to stable from negative.