A Bolt From The Blue: Treasury Yields Go Haywire; Fitch Retains Negative Watch Despite US Debt Ceiling Resolution
Portfolio Pulse from Piero Cingari
Despite the resolution of the US debt ceiling standoff, Fitch Ratings maintains its 'Rating Watch Negative' stance on the US rating. Fitch is concerned about repeated political standoffs and last-minute resolutions undermining fiscal responsibility. Treasury yields spiked, and iShares Treasury Bond ETFs experienced losses.
June 02, 2023 | 7:24 pm
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NEGATIVE IMPACT
iShares U.S. Treasury Bond ETF (NYSE:GOVT) lost 0.6% as Treasury yields spiked following the resolution of the US debt ceiling standoff.
The resolution of the US debt ceiling standoff led to a spike in Treasury yields, which negatively impacted the iShares U.S. Treasury Bond ETF (GOVT). As yields rise, bond prices fall, causing the ETF to lose value.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100
NEGATIVE IMPACT
iShares 1-3 Year Treasury Bond ETF (NYSE:SHY) fell 0.3% as Treasury yields spiked following the resolution of the US debt ceiling standoff.
The resolution of the US debt ceiling standoff led to a spike in Treasury yields, which negatively impacted the iShares 1-3 Year Treasury Bond ETF (SHY). As yields rise, bond prices fall, causing the ETF to lose value.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100
NEGATIVE IMPACT
iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) tumbled by 1.1% on the day, marking its worst session since May 8, as Treasury yields spiked following the resolution of the US debt ceiling standoff.
The resolution of the US debt ceiling standoff led to a spike in Treasury yields, which negatively impacted the iShares 20+ Year Treasury Bond ETF (TLT). As yields rise, bond prices fall, causing the ETF to lose value. This marked TLT's worst session since May 8.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100