Joaquin was downgraded to a Category Two hurricane Sunday as it headed towards Bermuda, where it is expected to dump rain and generate damaging winds as it swirls nearby, forecasters said.

The hurricane's center is expected to pass west of Bermuda in the afternoon and continue past the north of the island nation Sunday night, the US National Hurricane Center said in its latest statement.

Joaquin's outer rainbands were already thrashing the island early Sunday, with dangerous winds forecast to follow, the NHC said.

However, additional weakening is expected over the next 48 hours, as the Category Two storm on the five-point Saffir-Simpson scale continues to decrease, it added.

Joaquin was swirling some 150 miles (240 kilometers) southwest of Bermuda at 1500 GMT, as it traveled northeast at 17 miles (28 kilometers) per hour.

Three to five inches (seven to 13 centimeters) of total rainfall across Bermuda were expected through Sunday night, the NHC said, and significant coastal flooding and life-threatening storm surges were forecast.

The NHC said that swells generated by Joaquin were still affecting the Bahamas, where homes were destroyed and residents were left without power or phone services after the hurricane tore past.

The southeast United States has already been battered by a separate weather system that has caused significant flooding.

That region is also seeing Joaquin-related swells that "are likely to cause life-threatening surf and rip current conditions," the NHC said.

"Even though Joaquin is expected to pass well east of the coast of the United States, a prolonged period of elevated water levels and large waves will affect the mid-Atlantic region," it added.