Market Information Monday 19 May 2025

Good morning,

Moody’s has downgraded its credit rating for the United States from AAA to Aa1, citing rising debt and long-term budget deficits. This means the U.S. has lost its last top credit rating from major agencies after similar moves by Fitch and S&P. The downgrade comes amid political tensions over a large tax and spending plan, expected to increase the deficit by $3 trillion. Though no major market shock is expected, the move could raise interest rates and further strain U.S. debt.

Pierre Wunsch, Belgian central bank chief, says the ECB should be ready to cut interest rates slightly below 2% due to economic shocks and uncertainty. Markets expect a June 2025 rate cut from 2.25% to 2%, with another possibly later in the year. Wunsch finds these expectations reasonable and sees light monetary support as justified by late 2025. His more moderate stance marks a shift from his previously stricter position on interest rates.

China has announced steep anti-dumping tariffs on imports of POM copolymers—an industrial plastic—from the U.S., EU, Japan, and Taiwan. These plastics are used in sectors like automotive, electronics, and medical equipment. Tariffs range from 3.8% to 74.9%, depending on the country and company. The move follows a recent temporary trade deal between China and the U.S. to reduce mutual tariffs for 90 days.

The 6M Euribor is unchanged at 2.16% compared to previous business day. The 10Y Swap decreased with 2 basis points to 2.53% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.