Moody’s placed a negative outlook on the U.S.’s AAA grade in August. The credit-rating agency said in a statement today that the rating would likely be cut to AA1 if negotiations are unable to produce such policies.

Plans that produce a stabilization and then downward trend in the ratio will likely keep its current rating.

The country’s course toward a “fiscal cliff,” a combination of expiring tax cuts and more than $1 trillion of automatic spending reductions set to take effect in January, is at the center of Moody’s warning.

“The maintenance of the AAA with a negative outlook into 2014” is unlikely, Moody’s said today in the statement. That outlook would only be extended if a “fiscal cliff actually materialized-which could lead to instability. Moody’s would then need evidence that the economy could rebound from the shock before it would consider returning to a stable outlook.”

Standard & Poor’s downgraded the United States on Aug. 5, 2011, and has said political and fiscal risks may lead to another downgrade. Meanwhile, Fitch Ratings has kept the country’s AAA rating with a negative outlook.