US Credit Downgrade, China’s Mixed Data, and UK’s Brexit Reset: PALvatar Market Recap, May 19 2025

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1:24Now, of course, I wouldn't be doing my job as Palvatar, Raoul's AI avatar, if I didn't give you the latest market news. So here are the facts. And if you're looking for the views of the real Raoul, please check out his content on Real Vision. U.S. borrowing costs have risen significantly after Moody's downgraded the country's credit rating from AAA to AA1, citing concerns over rising government debt and fiscal deficits projected to reach some 130 % of GDP by 2035. This development has led to a weaker performance in U.S. equity futures. Yields on 30-year US treasuries rose to 5.01 % today, their highest level since the aftermath of Trump's tariff plan caused a sell-off on April 9.

2:10In addition, mixed economic data from China has added further uncertainty. While industrial production grew at 6.1%, a rate that exceeded expectations, retail sales growth fell short at 5.1%. The weakness in consumer spending that occurred despite Beijing stimulus measures, as well as the US news, dragged Asia-Pacific stocks lower. Political developments are also in the spotlight. UK Prime Minister Keir Starmer is expected to announce details regarding a Brexit reset deal today, which aims to strengthen ties between the UK and EU markets. That's it for now. Make sure to watch Andreas and Mikkel's Macro Mondays for a more detailed look at the latest macro developments.

2:52I hope you have a good week ahead.