Standard & Poor's Ratings Services cut its rating on Detroit's general obligation debt to 'C' from 'CC' on Friday, and gave the bankrupt Michigan city a negative outlook.

"The downgrade reflects the city's position as the subject of a bankruptcy petition, as of July 18, 2013," said Standard & Poor's credit analyst Jane Ridley.

"The negative outlook reflects our expectation that, given the Emergency Manager's statements regarding debt restructuring, actions taken to date, and negotiations currently underway with bondholders, we could lower the rating in the one-year time horizon of the outlook," Ridley said.