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Puerto Rico government urges action amid bond rating drop

Puerto Rico's government is urging legislators to move quickly to approve financial austerity measures following a report from a Wall Street ratings agency that downgraded the island's general obligation bonds to near-junk status.

Standard & Poor's noted that the U.S. territory's budget gap is significantly larger than originally estimated, and that current shortfalls will prevent the island from rebounding economically in the next two years.

The agency warned that if only limited progress is made in reducing the gap, it would further lower the rating.

S&P also downgraded the rating of the Government Development Bank of Puerto Rico on Thursday, saying it's not sufficiently independent from the state.

The budget gap stands at $2.1 billion, not roughly $300 million as originally estimated.