Despite weak U.S. economic reports, markets were still rising as of Friday morning. Earlier in the week, investor attention was focused on Federal Reserve chair Janet Yellen, as she testified on the Semiannual Monetary Policy Report before the House and Senate. Yellen reiterated the Fed's plan for quantitative easing and stated that she expects "a great deal of continuity in the FOMC's approach to monetary policy." Investors saw this as positive, sending markets up, while the yield on 10-Year Treasury's spiked to 2.8 on Wednesday, before settling down to 2.73 to close out Thursday. In macro news, January's Industrial Production numbers showed a 0.3% decline, whereas analysts were expecting a 0.2% gain; the cause of the decline is mostly being blamed on weather. Retail sales for January declined 0.4% from December, but were 2.6% higher than January 2013. In employment news, Initial Jobless Claims came in at 339,000, which was higher than the 330,000 expected. Below, we look at all of Moody's municipal bond upgrades and downgrades from the past week.

Upgrades

• Genoa Township, MI: Moody's upgraded this township to Aa2 from A1. The upgraded Aa2 rating primarily reflects the township's strong full valuation per capita and median family income figures coupled with minimal exposure to defined benefit pension liabilities. The rating further incorporates a moderately-sized full valuation, healthy financial position, and moderate debt burden.
• Uhlich Children's Home, IL: Moody's upgraded this bond to Aa3 from A2. The ratings are based on the credit quality of the Bank and the structure and legal protections of the transaction, which provide for timely payment of debt service and purchase price to bondholders.
• Midlothian's Community Development Corporation, TX: Moody's upgraded this corporation to A1 from A2. The rating upgrade to A1 from A2 reflects the corporation's ample debt service coverage, steadily increasing sales tax revenue, limited leverage of the revenue stream and conservative budgeting that has led to solid reserves. The rating also takes into account the corporation's satisfactory legal covenants.
• Metropolitan Nashville Airport Authority, TN: Moody's upgraded this airport authority to A1 from A2. The upgrade to A1 is supported by the airport's low and declining debt levels and the above average growth of the Metropolitan Nashville area's population base, economy, and passenger enplanement levels.
• Chestnut Ridge School District, PA: Moody's upgraded this school district to A1 from A2. The A1 underlying rating reflects the district's stable financial position with strong reserves, modest tax base with below-average demographics, and above-average debt burden.
• St. Johnsbury School District, VT: Moody's upgraded this school district to Baa1 from Baa3. The Baa1 rating reflects the district's improved but pressured financial position over the past three years, limited tax base with below-average wealth levels and low debt burden. The rating also reflects improved financial management with regular oversight of the district's budget and reliance on annual cashflow borrowing.
• Prosper, TX: Moody's upgraded this town to Aa2 from Aa3. The assignment and upgrade to Aa2 reflects the strong and stable financial position of the Town that's been driven by an active and conservative management team. The upgrade also considers the rapidly growing tax base and resident wealth levels that are well above national levels, while also taking into account the elevated debt burden with additional borrowing planned and needed to support the continued growth.

Downgrades

• Orchard School Foundation, IN: Moody's downgraded this foundation to A3 from A2. The downgrade to A3 reflects Orchard's reliance on elevated endowment draws to support operations and resulting deficit operations.
• Polk County Housing Finance Authority, FL: Moody's downgraded this housing finance authority to Aa1 from Aaa. This rating action reflects Moody's review of the governing legal documents, which indicate that the legal structure of the transaction, combined with the current financial position of the program, does not support the current rating on the bonds in adherence with our rating methodology, "US Stand-Alone Housing Programs Secured by Credit Enhanced Mortgages", published on December 13, 2012.
• City of Giddings, TX: Moody's downgraded this city to A2. The A2 rating reflects the city's small tax base, which experienced modest overall growth in recent years due to commercial and residential development, as well as pressured financial performance. The city relies heavily on its utility funds, which have limited liquidity, and sales tax collections, an economically-sensitive revenue stream, to support General Fund operations.
• Easton Area School District, PA: Moody's downgraded this school district to Aa3 from Aa2. The downgrade to Aa3 rating reflects consecutive years of operating deficits and ongoing use of reserves to mitigate budgetary pressures, which have reduced the district's financial flexibility. The rating further reflects a sizable tax base with average wealth indicators and an above-average debt position.
• City of Watervliet, NY: Moody's downgraded this city to A2 from A1. The downgrade to A2 incorporates the city's limited tax base with below-average wealth levels, narrow reserves, and elevated debt burden.
• City of Chillicothe, OH: Moody's downgraded this city to A2 from A1. The A2 long-term rating reflects the city's narrow General Fund reserves which are dependent on relatively pressured revenue sources; moderately-sized tax base which serves as the economic center of Ross County (GOLT rated Aa2); below average resident wealth profile; and manageable debt burden with elevated exposure to unfunded post-retirement pension obligations.
• Aurora City School District, OH: Moody's downgraded this school district to Aa2 from Aa1. The Aa2 rating reflects the district's modestly sized and wealthy tax base with access to employment opportunities in Cleveland (A1 stable) and Akron (Aa3); stable and satisfactory reserve levels; strong management team which has successfully navigated the levy cycle; manageable debt burden; and exposure to poorly funded state cost-sharing pension plans.
• Riverside School District, PA: Moody's downgraded this school district to A3 from A2. The downgrade is due to the district's reduced financial flexibility, which will make it more difficult to cope with such challenges as rising pension funding costs and a heavy dependence on state aid. The rating also incorporates the district's limited tax base, a weak socioeconomic profile, and a heavy debt burden that is expected to moderate over time. Moody's expects the district's reserves to remain stable going forward. Any departure from this expectation would apply renewed downward pressure on the rating.
• Suffern, NY: Moody's downgraded this village to Baa1 from A2. The double-notch downgrade to Baa1 reflects Moody's expectation that the village will continue to experience significant financial stress over the medium term. Moody's believes that short-term efforts to improve the village's available reserves from their current negative levels (-$115,000 at the end of fiscal 2012) will not substantially ameliorate the ongoing pressure applied by the water and sewer funds, which together owe the general fund $1.3 million and require annual financial support.
• Bingham County School District 55, ID: Moody's downgraded this school district to A2 from A1. The downgrade to A2 on the district's underlying rating primarily reflects the district's weakened financial position as a result of poor financial management oversight and failure to make budget corrections during the course of the school year. The rating also incorporates the district's small and rural tax base, below average socio-economic indicators, and declining enrollment trend.
• University of Puerto Rico: Moody's downgraded the University of Puerto Rico's University System Revenue Bonds to Ba3 from Ba1 and Educational Facilities Revenue Bonds, 2000 Series A issued through AFICA to B1 from Ba2. The downgrade of the University of Puerto Rico's bonds follows the downgrade of the Commonwealth of Puerto Rico and the Government Development Bank (GDB) to Ba2 from Baa3. The outlook is negative. Driving the two-notch downgrade of the University of Puerto Rico (UPR) is its extraordinarily high reliance on the commonwealth for operating revenue (67% of revenues) and for governance coupled with its reliance on GDB for liquidity and financial management support. The Ba3 rating reflects ongoing enrollment pressures, exposure to Pell Grant reductions, the need for ongoing capital and infrastructure investment and significant pension and OPEB liabilities.
• Morgan State University, MD: Moody's downgraded this university to A1 from Aa3. The downgrade of Morgan State's rating to A1 reflects recent enrollment challenges contributing to weakened operating performance.