The U.S. Government's Credit Rating Just Got Downgraded for the Third Time Since 2011. History Says the Stock Market Will Do This Next.
In a Friday night surprise, Moody's (NYSE: MCO) downgraded the credit rating of the United States government one notch from "Aaa," its highest rating, to "Aa1." Moody's has 21 grades in its ratings scale. Moody's is the last of the three major credit rating agencies to downgrade U.S. credit.S&P Global (NYSE: SPGI) downgraded the U.S. back in 2011, followed by Fitch in 2023. While the timing of the downgrade may have surprised some, Moody's had previously warned about a downgrade earlier this year, citing growing fiscal deficits and elevated levels of total debt. On Monday, following the downgrade, the stock market seemed to take the bad news in stride, although traders in the Treasuries market do not seem to be happy with the news.Here's what history says happens to the stock market next.Continue reading
In a Friday night surprise, Moody's (NYSE: MCO) downgraded the credit rating of the United States government one notch from "Aaa," its highest rating, to "Aa1." Moody's has 21 grades in its ratings scale. Moody's is the last of the three major credit rating agencies to downgrade U.S. credit.
S&P Global (NYSE: SPGI) downgraded the U.S. back in 2011, followed by Fitch in 2023. While the timing of the downgrade may have surprised some, Moody's had previously warned about a downgrade earlier this year, citing growing fiscal deficits and elevated levels of total debt. On Monday, following the downgrade, the stock market seemed to take the bad news in stride, although traders in the Treasuries market do not seem to be happy with the news.
Here's what history says happens to the stock market next.
