Credit markets have begun to respond to stress related to the debt ceiling and lawmakers’ inability to find a solution. While default is not anticipated, both equity and credit markets are beginning to send signals that October 17 will have major repercussions for the U.S. economy as the government eyes short-term solutions. The 10-year Treasury yield moved to 2.72 percent, the highest since Sept. 22, before settling at 2.69 percent. The impact of 800,000 government furloughs will most certainly weigh on the Fed when it considers the prospect of “tapering” in the near future.
See the latest rates and U.S. Treasury chart here.
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