Gold gains after Moody's negative rating

Gold rose 1.6% to near $3,250 per ounce, supported by investor appetite for safe-haven assets following Moody's downgrade of the United States' credit rating from AAA to AA. This decision raised concerns in the markets and dampened investor appetite for risk, especially after a series of consecutive gains in US stocks.

Highlights of the Moody's report:

Growing public debt: The US debt-to-GDP ratio reached 98% in 2024, higher than that of its advanced economies. Despite the Trump administration's pledges to reduce the deficit, Moody's expects the ratio to reach 135% before 2035.

Increasing interest burden: Interest payments rose to 18% of federal government revenue in 2024, compared to just 9% in 2021, reflecting increasing pressure from rising yields and volatile trade policy.