"Although the government will likely continue to make gradual progress in reducing its deficit, the debt burden will remain high," Moody's said.
"The absence of a new funding program is credit negative from the perspectives of external payments and growth."
IMF ended a 2.6 billion US dollar loan program last year.
Sri Lanka dropped plans for another IMF program last month after the lender declined to disburse money to the Treasury rather than the Central Bank, while also saying there was timing issues related to any agreed reforms.
Moody's has given Sri Lanka a 'B1' speculative rating with a Positive outlook.
Moody's has just released a report 'Sri Lanka -- The Post-IMF Backdrop: Downward Growth Pressures and Elevated External Pressures", that looks at macroeconomic stability, external payments position and controlling budget deficit which affect the credit outlook.
Moody's said there has been progress since a civil war ended in 2009.
"However, given the challenging macroeconomic backdrop, the report's conclusion is that a follow-up funding program would have augmented international reserves directly through borrowed IMF resources," the rating agency said.
"Through enhanced policy certainty under an IMF funding program, investor confidence would likely have been bolstered.
"And in doing so, it would have provided additional support to the balance of payments and economic growth prospects."
Moody's said the government will continue to gradually reduce its deficit but supplier cash arrears, weak revenues and contingent liabilities in state enterprises were concerns.
"Moreover, high inflation and rapid credit growth are risks to macroeconomic stability," the agency said.
Other analysts have said that moves to adjust power prices as well as more frequent changes to petroleum products are likely to reign in credit growth and reduce the risk of balance of payments pressure.
So far this year private credit growth has slowed allowing the Central Bank to build up reserves by selling down its Treasury bills stock and killing credit.
State borrowing from banks remain high, though it expected to ease when power prices are raised after April.
Meanwhile Moody's said while reserves have grown back to 6.9 billion US dollars as Sri Lanka recovered from a 2011/2012 balance of payments crisis, they are still below 8.1 billion US dollars in July 2011 when the country's outlook was changed to positive.
Moody's said its External Vulnerability Indicator (EVI) measured external reserves at 124 percent of short term debt, it was down from 132 percent, but higher than 100 percent.
IMF, which tracks net reserves has said that under its measurements reserves were below 100 percent of short term debt.
Moody's said a new IMF program would have helped build reserves by 1 to 1.5 billion US dollars.
Moody's said it was better to push for foreign direct investment rather than foreign bank credit.