Debt Ceiling Looms Over Shutdown Talks That Are at a ‘Mind-Numbing’ Impasse
Moody’s Investors Service analysts have warned that shutdown 2.0 could have a “more severe impact” on U.S. output. And if it were to extend beyond the March 1 end of the suspension of the current cap on America’s statutory debt capacity, “it would complicate negotiations over the debt ceiling.”
“Everywhere I look, whether it’s this, a weak economy, or disappointing tax refunds, it’s a plus for bonds,’’ said Greg Valliere, who was previously chief global strategist at Horizon Investments. The inability of politicians to make a deal is “‘mind-numbing.”
Benchmark 10-year notes yield 2.65 percent, down from last month’s 2019 high of 2.8 percent.
Isaac Boltansky, a senior policy analyst at investment advisory firm Compass Point, said on Bloomberg TV Monday that the odds of a shutdown are now about 60 percent, up from 30 percent last week.
“This isn’t really solely a shutdown issue, it’s indicative of the legislative brinkmanship and the crisis governance that is really going to dictate the next year and half,” which includes debt-ceiling re-negotiations, he said.
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