Robertson Stephens Weekly Commentary – May 19, 2025

Moody’s lowering of the US sovereign credit rating to Aa1 from Aaa was not entirely surprising; S&P cut its rating of the US as a borrower from its highest rating of AAA to AA+ many years ago, as did Fitch’s in 2023. (Note: there are ratings of instruments and ratings of borrowers, and both can fluctuate, possibly in different ways. The 30-year Treasury bond yield rose above 5.00% on an intra-day basis 5/19.25 – which is close to 2023’s cyclical high, triggered, in part, by a weak Treasury bond auction, which signaled the supply of Treasuries due to increasing budget deficits was weighing on the market. The bond market may be starting to anticipate a similar concern ahead (thanks to Moody’s recent downgrade), along with somewhat hotter inflation numbers, as communicated last week by Walmart on their earnings call. On the wealth planning front, we provide a legislative update on the House tax bill.