Moody's last adjusted the city's GO rating in March 1974, when it upgraded the bonds to Aaa from Aa. The Moody's downgrade is "really not coming as a huge shock," a California-based trader said yesterday, observing that "psychologically, people sort of built it in." Accordingly, the interest-rate penalty for the city might amount to only a few basis points, the trader said. Standard & Poor's Corp. yesterday maintained its AA rating on the city's GO bonds and also kept its ratings on Los Angeles certificate of participation issues at current levels. But Standard & Poor's also maintained its negative outlook on the ratings and cautioned that it is monitoring the city for some sort of improvement in coming months. "Maintenance of the current rating will depend on how extensive the economic restructuring becomes, whether the area shows improvement over the next year, and how well the city manages to align revenues and expenditures in a long-term, ongoing fashion," Standard & Poor's said in a release.