Moody’s Downgrades U.S. Credit Rating, Treasury Secretary Threatens Tariff Restoration—Gold Prices Surge!  

TradingKey – The U.S. credit rating was downgraded by Moody’s, and the Treasury Secretary threatened to reinstate reciprocal tariffs, triggering a surge in gold prices amid heightened risk aversion.  

During Asian trading hours on Monday, May 19, spot gold (XAUUSD)rose over 1%, rebounding to its May 15 high and trading around $3,223 per ounce.  

In the short term, gold faces resistance at $3,260, which was last week’s peak—an area where price attempted to break through four times but failed.  

 Gold Price 1-Hour Chart – Source: TradingView.

The latest gold rally stems from growing concerns over U.S. economic stability and widening budget deficits.  On Friday, May 16, Moody’s downgraded the U.S. sovereign credit rating from Aaa to Aa1, citing the Trump administration’s failure to reduce the federal deficit. 

Additionally, the U.S. may reinstate reciprocal tariffs, as Treasury Secretary Bessent stated on Sunday.