The Moody's announcement follows similar actions from Fitch and S&P in recent years and could result in higher borrowing costs.

In a separate interview on Fox Business Network’s “Mornings with Maria” on Monday, Hassett called U.S. debt “the safest bet on Earth,” but similarly said that the new rating is “backward looking” and is “penalizing us for all the reckless spending of the Biden administration” — all while predicting an economic “liftoff.”

Investors will be watching Home Depot (HD) earnings on Tuesday for signs of consumers pushing off home renovation projects due to tariffs and challenges in the housing market. Wall Street expects the home improvement retailer's revenue grew 7.

U.S. stocks closed higher after an unsurprising US credit rating downgrade. Treasury yields rise. S&P 500 extends winning streak to six days.

Treasury Secretary Scott Bessent downplayed the U.S. credit downgrade as a "lagging indicator" of economic and fiscal conditions, after Moody's took the U.S. off its top tier.

By Sruthi Shankar and Purvi Agarwal (Reuters) -European stocks closed flat on Monday, following a five-week winning streak, as declines from a surprise U.S. credit rating downgrade were offset by upbeat corporate updates.

White House National Economic Council Director Kevin Hassett criticized Moody’s Ratings over its decision to lower the US credit rating, calling the move backward-looking and saying the Trump administration is committed to lowering federal spending.