"Consumers continue to face many pressures including high unemployment, low housing prices, and a reduction in available installment credit," says Maggie Taylor, senior credit officer at Moody's, in a release. "In addition, we believe the current consumer trend towards saving and repaying debt will continue over the intermediate term. This will likely make it challenging for industry conditions to materially improve from their very weak levels."

Moody's also notes that some specific sub-sectors will be strong, notably supermarkets, drugstores and chain discounters, while others will produce disappointing results. "Although certain sectors--such as the department stores and specialty retailers--are likely to experience further earnings pressure, the level of deterioration in these sectors is likely to moderate to a level that will not materially impact overall US retail credit profile over the medium term," according to a release.

In addition, the stable outlook also reflects "the sizable portion of retail sales that are generated by the larger retail chains which are likely to be more stable," the release states. Smaller "mom and pop" operations will continue to erode, according to Moody's.