Recent changes in municipal bond ratings reflect regional differences in the economy.

In the first half of 1990, Moody's Public Finance Department revised 186 municipal bond ratings. The tally was 102 upgrades, affecting $19.5 billion worth of debt, compared with 84 downgrades ($21 billion). Revisions on the debt of six major issuers affected $32.5 billion of the $40 billion.

More than 90 percent of the debt upgraded was in the Far West. That was mostly because of economic improvement in Washington state and Oregon. The Washington Public Power Supply System (WPPSS) debt of $6.3 billion received a big boost when its paper on three nuclear projects was upgraded from A to AA. The State of Oregon's $6.3 billion of debt and Washington state's $3.6 billion were both upgraded from A1 to AA.

The Southeast and Great Lakes regions also received upgrades. Moody's believes that Louisiana, where debt has been downgraded frequently recently, is showing signs of "bottoming out" in its economic downturn. Other states in the region are growing, which contributes to strong tax bases that help their underlying debt.

Five regions received generally unfavorable debt rating revisions: New England, the Mideast, the Southwest, the Rocky Mountain and the Plains.

New England, until recently a star, was the hardest hit, with significant downgrades affecting $8.4 billion of the State of Massachusetts's debt and $3.1 billion of Connecticut's. Another downgrade worth noting was the fall of Philadelphia's $1.3 billion debt into the speculative grade of Ba from Baa.

The Treasury plans its August refunding this week. It will include a three-year note in $5,000 minimums Tuesday; a 10-year note Wednesday and a 30-year bond Thursday. The latter issues will have $1,000 minimums. They should return 7.98 percent, 8.48 percent and 8.60 percent respectively. The refunding is contingent on Congress raising the debt ceiling.