Moody’s Downgrades U.S. Credit Rating: Market Reacts to Historic Shift

Moody’s has downgraded the United States’ sovereign credit rating, from Aaa to Aa1, marking a historic moment and sending shockwaves through global financial markets. The agency cited escalating debt levels and widening fiscal deficits as key drivers behind this unprecedented move. As of May 19th, 2025, stock values and Treasury bonds declined in response to the news, while the U.S. dollar weakened significantly. This marks the first time since 1917 that the rating has been lowered. President Trump vehemently disagreed with Moody’s assessment, challenging their methodology and expressing disapproval through public statements.